Is It Better To Hire Employees Or Independent Contractors?

Do We Hire Staff or Contract?

As a hiring manager, you need to hire for a specific role. But are you hiring an employee or an independent contractor? I’ve had many clients ask me whether to post a job as staff or contract because they think the difference between an employee and a freelancer is based on the subject matter, hours of service, or duration of employment.

Call Your Attorney

Whether you hire staff or contract employees is not a matter of choice: it’s a legal issue. Here are a few questions to help guide you, but know that I’m not your lawyer and I can’t decide for you. I’m certainly not offering legal advice. I work in staffing, not a legal department.

But I do know that the primary differences between staff and contract workers lies in where they work, when they work, who supervises their work, and who owns the equipment on which they work. The federal tendency toward looking at who controls the relationship is a confusing guideline, but it helps some clients, so I often refer them to it.

Where Do They Work?

Someone who works from home could be a contractor, but they can also be on staff. Where they work is less important than the specifics of whether they control the details of their work. If they’re hired for one project that has a deadline and you don’t care when they do the work as long as it’s done by that deadline, you might be looking at a contractor. If they need to work during your company’s business hours on regular business days, you likely have a staff employee.

Who Supervises?

If the project work is directly supervised, you probably have an employee. If the work is done according to the worker’s specifications without direction, you might have a contractor.

Who Owns the Equipment?

When you supply the computer, sample kit, or xylophone, you probably have an employee. If they bring their own laptop, magic tricks, or guitar, you likely have an independent contractor.

Take a look at NOLO and your state’s guidelines for determining what kind of position you’re hiring. If you don’t have legal counsel or a human resources department, your payroll service, legal consultant, bookkeeper, or HR consultant might help.

Just know that regardless of what you’d prefer, there are strict legal parameters for calling an employee staff versus an independent contractor. This post is by no means extensive enough to offer practical advice on how to characterize your employee; I’m just offering thought starters.

Because regardless of which type of employee you need, once you come up with the job description, requirements, and preferences, I can find you well-vetted, professional candidates quickly. I’m always just a click away.