Page 5

TA_DEC_2015

FEATURE Contract Employee And Contractor What’s the difference? “Hiring” has always been a challenge for organizations that comes with a potential risk. What if after all the efforts and spending time plus money on recruitment, you get an incompetent and illiterate workforce! All of this must be considered; therefore, hiring right help for your business comes with specific considerations that you shouldn’t ignore. Determine whether you need a full/part-time employee either for long or short-term! Do you have resources to hire or should you seek out contractor? Understand the difference between contractors and contract employees if you wish to find the best match. Employment Status Primary difference between contract staff and contractors can be identified through their connection to your business and duties per-formed. Remember, a contractor isn’t an employee; he simply cater limited services to your organization and isn’t liable to rights, protec-tion and liabilities of federal employment jurisdictions. In contrast, a contract employee is obliged to follow these rights, protection and liabilities while having a direct connection to your business. However, it comes with a set of greater obligations and potential risks as well. Legal Obligations As independent business owners, contractors carry their own liability for workplace negligence, accidents, injuries or any other damage either to themselves or company’s assets. This means they should have their own insurance to cover the damages, as organization isn’t responsible to compensate! Whereas contract employees aren’t independent, they’re an extension of your company and compensation to all damages or personal injury rests upon employer. Cost Variation If your company is hiring contractor, it’ll involve one-time cost based on total work you’ve requested. Though a fixed expense, it may vary under specific scenarios such as unexpected problems, job modification, so on. Contract employees involve cost that continues throughout their term with ancillary expenses such as healthcare or a bonus. Overall cost for each may be comparable but expenses involved affect your business’ cash flow in several ways. Taxes Being self-employed, contractors are required to withhold and administer their own tax liabilities related to the work they perform. Contract employees, on the other hand, without taxes from wages, file a record and regulate it to appropriate tax agencies in your area or industry. Recruiting Contractors When organizations required skilled services to complete a specific task, hiring a contractor is the best option. These particular work tasks can be categorized as installing new roof, mending parking lot and such in which project completion time varies. Contractors’ errands are defined and are paid as per number of tasks performed, while they typically fall outside the business spectrum. Contractors prefer working with their own set of equipment, thus, avoiding liability risk of employees or when odds favor total job cost! Contract Employees Contract employees are considered the best option for tasks having a predefined time-length or deadline. These, by virtue of employer-employee relationship are more close to work standards, site loca-tion and work for standard work hours. Important supplies, tools and equipments are supplied by businesses and contract employee’s responsibilities are adjusted per contract term in order to meet ever-changing business need. Conclusion Every company has specific hiring standards and procedures based on their organizational structure and work operations. IT contract staffing for instance, one would consider technical expertise to manage crucial networking tasks. Whatever the case, it’s important to know the difference between contract employees and contractors which we’ve defined above. CWTE By Jenessa Baxter Jenessa Baxter is a Digital Marketer for Ultimate HR Solutions in Dubai. She writes about HR recruitment tips, leadership, HR management. She is also a business coach and author at a local newspaper.  Email Jenessabaxter25@gmail.com Follow @iamjenessabax Would like to Comment? Please Click Here. Talent Acquisition Excellence Essentials presented by HR.com | 12.2015 Submit your Articles 5


TA_DEC_2015
To see the actual publication please follow the link above