This means contractors have to be much more entrepreneurial and business-savvy than employees, at least with respect to managing their taxes and benefits, yet it also affords them a far greater degree of freedom. By law, contractors can’t be required to perform their work in a specific place or time, allowing them to choose when and how they get their work done. If these rules are broken by the employer, e.g. by requiring a contractor to work in the office from 9-5, the contractor could sue for employee benefits. Introduce candidates who are unsatisfied with their current full-time positions to contract work. Chances are, the candidate doesn’t know the flexibility and benefits that contract positions can offer. They may not even know they could get healthcare, dental, vision and a 401(K) while in a contract position, if they are employed by an employer of record like FoxHire.
Although the IRS has no absolute definition of either the independent contractor or the W2 employee, they do have a 20-point checklist to determine employee status. Some years back, people with full-time jobs believed they had secure employment, but all parties understand that contract job will end at the completion of the contract. The reality today is that no job is secure,whether it’s a full-time or contract employment, so it doesn’t matter whether you choose a contract job or full-time employment . Experts project that by 2020, contract workers and freelancers will make up 40 percent of the workforce in the United States of America. Employers will lose valuable opportunities if they recruit one type of employee. Therefore, the decision to hire contractors or full-time employees may be built into the type of company and the industry it serves.
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That way, you can compare the salary for each role to each other role. Contract work is on the rise, and who knows what the future could look like in the next 50 years. With the rise of AI’s, full-time employment could go the way of the horse and buggy. We covered this one above, but since the contract vs full time salary company is so large, they don’t need you to work on copy, marketing, graphic, distribution, packaging, etc. They only need you to be good at one of those things, but you have to be very good at that one thing. Decide if the compensation is worth what the commute does to your body and health.
A job may offer you less money than you were expecting, but their benefits package may more than make up for it in the long run. Decide whether you are willing to take a pay cut from your usual rate in exchange for long-term benefits and factor that into your negotiations. In the example above, Joe needed to compare a contractor role paying $80k to a full-time role paying something like $55k. The employer is responsible for a lot of the cost of employing someone.
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A simple way to determine if someone is a contractor is to ask, “How many people employ this person? When they decide to hire people full-time, most companies are also looking to invest in their employees additionally. Additionally, you will also have the freedom to choose your own projects. Initially, contractors that are still trying to “get their name out there” and grow their business won’t really have this commodity. It can sometimes happen that, as a contractor, you do get offered consistent work within a company, but this will only last a certain period of time. The easiest way to approach this matter is by exploring all of the unique advantages and disadvantages of both full-time jobs and contract work and comparing them to your own needs and expectations.