10 Benefits of Hiring Independent Contractors Over Employees

The past year significantly changed how companies perform business. Work trends in the business industry have also evolved into a more technology-dependent dynamic. These include the sudden move toward a more remote work setup, the balloon of freelance workers, and the advances in technology that helped shape how employees, namely self-employed contractors and independent contractors accomplish their responsibilities.

Interestingly, independent contractors have helped curb costs in so many ways. But are they really worth hiring? Here are the top 10 benefits of hiring independent contractors that you need to consider for your business:

1. Lesser costs

Companies are always looking for ways to cut costs, increase productivity, and hire contractors. Here are some expenses that are crossed out when a company hires contractors instead of employees.

1. Payroll taxes
2. Insurance
3. Overtime pay
4. Office supplies and equipment
5. Bonuses

2. You are working with experts

When hiring independent contractors, you will be expecting a set of independent workers who have great expertise in their respective crafts. Relative to employees who, most of the time, require training and mentorship from their commanding officers, independent contractors are not entitled to these services. Hence, as an employer hiring independent contractors, you shall count on individuals who are already skilled and learned what they applied to perform for your company.

3. No lags and higher efficiency

Another salient benefit of hiring contractors is the reduced lags and better efficiency. Hiring independent contractors comes on a needs-basis principle. In other words, your independent contractor is hired because of their qualifications and expertise, so you have the right to what needs to be done by the contractor. This process skips the usual onboarding process of an employee and any training that the usual employee must undergo to attain the requirements needed to do a specific job.

4. Lesser or no overhead expenses

Since there are no communal spaces to be used as offices, no equipment or tools to be provided, and other expenses that a business can incur, as with having employees, the company does not have to worry about these overhead expenses. Independent contractors are also independent business owners to have their own office, equipment, tools, and trained people to work on your contracted job.

5. No employment benefits to consider

Another essential factor to consider in the independent contractor versus employee debate is the responsibility of providing employment benefits to employees, which is nonexistent when you hire independent contractors. Regarding the finances, hiring independent contractors will be far more advantageous to your company as benefits usually given to employees are not always provided to contractors. Yes, employment benefits are not the same as contractor benefits.

Employment benefits like vacation pay, sick leave, retirement benefits, social security, worker’s compensation, healthcare, overtime, and unemployment benefits will no longer be considered because you are only paying for casual or temporary labor.

6. Human Resources will not be dealing with employee termination

The Human Resources department will also not necessarily be responsible for the termination of an independent contractor, in contrast to employee termination, where Human Resources plays a key role in closing the relationship of the manager and the employee. The independent contractor agreement states the specific job required with a dictated duration of time to be finished. Included in this agreement are other points where it provides the company the ability to terminate with ease if the other party does not comply with one or more of these items.

7. No need for further training

The no-longer-requirement of training contractors is also one of the many independent contractor benefits. Independent contractors are hired based on their qualifications. This includes required training certifications, documentation, and general proofs of being skilled in particular fields. Having these documents with them will prove that they no longer necessitate training and mentorship, which are usually enjoyed by employees.

8. Requires minimal to no supervision at all

An employee and an independent contractor may perform the same amount of load and tasks. However, employees may give their employers more workload as most of them still need supervision and chastising when they are performing the tasks wrong. Independent contractors require at most minimal supervision if any. Since independent contractors are paid to finish a certain job for a specific time, how they complete it is not the primary concern of the business owner. There is no micromanaging but still getting the results that you wanted.

9. Less administrative work for the company

Processing the documents for contractors such as independent contractor payment rights, timesheets, payroll, tax declarations, onboarding is also way less exhausting when compared to the administrative work that need to be performed when hiring employees. This is not only a benefit for employers but also for the independent contractors themselves, as having to fulfill such piles of paperwork will be stressful.

10. No further legal implications of hiring in your country or abroad

Choosing to hire independent contractors over employees is also advantageous considering the legal implications the employer may have to face when hiring either of them. Hiring independent contractors provides an easier way to navigate complex labor laws in multiple countries where your company conducts business.