Independent contractors and other non-full-time workers make up approximately a third of the U.S. workforce. They’re a popular choice for companies that range in size from nascent start-ups to the Fortune 500, and vary in industry from information technology to healthcare — and most everywhere in between.
Is hiring contractors a good move for your company? Do certain positions have requirements that only full-time employees can fulfill?
The issues at play here are complex. But by answering these four simple questions, you should be able to figure out whether the scales tip toward a contractor, or lean more heavily toward a full-time staffer.
1. Do Your Staffing Needs Fluctuate?
Whether determined by seasonality, by short-term projects that require specific skill sets, or host of other factors, many businesses simply need to ramp up operations quickly, and be able to scale them down just as fast.
Hiring contractors offers flexibility that full-time employees don’t, and often helps contribute to leaner operations. When filling a position, consider whether the role will be addressing short-term or long-term needs; whether there will be time to train a newly hired full-time employee; or whether a seasoned contractor — accustomed to diving into projects with little guidance — might be a better choice.
An ideal time to consider staffing with contractors is when you have a significant short-term project that, once launched, will require minimal maintenance that can be handled by current full-time staff.
2. How Much Money Will Your Organization Save?
Typically, organizations save money when they staff with independent contractors. Determining the savings for a specific position is fairly straightforward. Make a two-column chart that lists on one side every expense of bringing on a full-time staffer, and on the other side, those associated with hiring an independent contractor. Include salary or wages, benefits, taxes, even office space, equipment, and software.
Armed with this data, it will be easier to determine whether the cost savings realized when hiring a contractor are significant enough to give up the many benefits of hiring a full-time employee instead (like control, oversight, and loyalty, to name a few).
3. How Much Control Over the Position is Necessary?
Staffing with contractors can cost less and offer more flexibility to an organization. But within the very term “independent contractor” lies the rub: they’re independent, often by nature and certainly by definition.
Is it important that the person you bring on board follows processes established by your company? Or that they use legacy software that’s not going away any time soon? Or that they’ll be working with a team that’s highly collaborative in nature?
This isn’t to suggest that contractors can’t be team members, or learn new processes and skills. However, the more control your organization wants, needs, or expects to have over how someone accomplishes their work, the less likely it is that a contractor is your best (or legal) option. If a manager tells a contractor how to do a task, instead of allowing her to do it in the fashion she deems best, your company may get a call from an auditor.
4. How Would Hiring a Contractor Affect Your Company Culture and Workflow?
Would your current staff appreciate the boost seasonal contractors bring? Or are there already so many comings and goings that adding another temporary face to the mix would be more disruptive than productive?
Though a contractor might be just the person you need for a short-term project, is there a possibility that the role might be expanded in the future? Can you picture it filled by an employee who will be there loyally, day in and day out, as your company grows — and he fills bigger and bigger shoes as it does?
Full-time employees with job security bring dedication and offer a level of reliability and stability to the companies that hire them. They often juggle multiple tasks and take on work outside the scope of their original job description.
If, after considering these four questions, you’re still torn between hiring a contractor or bringing a full-time employee on board, you have a final option: Create a contract-to-hire position. It will attract those seeking permanent employment, and give your company an ample period to evaluate their work!
Author Bio
Deepa Unadkat is a forward-thinking HR Manager specializing in Talent Acquisition, Candidate On-boarding, HR policies and practices, and Benefits Administration. She is always on the lookout for the latest trends and ideas that can improve HR operations.
Founder of Talent Acquisition Innovation and Leadership Forum on LinkedIn
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