Deciding on working as a contractor or an employee? In this blog, Strive for Talent explore the pros and cons.
There are certain differences between contractors and employees. Contractors, for example, are self-employed, decide their own fee, and are hired by outside organisations to complete a specific project or function. With this being the case, they are responsible for a greater amount of duties, such as tax management and administration. Employees, however, work exclusively for a business on a permanent contract. In exchange for completing the tasks of their role, an employer will handle areas such as superannuation and management of leave.
So, with all this in mind, which is better? In this blog, the team at Strive for Talent list the pros and cons of employees and contractors.
Employment – Pros
Whilst employed, you will have:
- Instalments made to your superannuation fund from your pay check
- Tax withdrawn incrementally to account for future liability
- A consistent stream of income
- Paid sick, annual and bereavement leave
- A regular and consistent routine to structure your life around
Employment – Cons
With these good points, employees must also contend with:
- Fixed hours
- Limited leave allotments per year (especially when it first has to be accrued)
- Travel to work sites or offices
Contractor – Pros
- Set their own work hours
- Negotiate the amount they charge for their services
- Work either remotely or from their own homes
- Vary their projects or hours
- Claim expenses as tax deductions
Contractor – Cons
Just like employees, contractors do have their fair share of negative working elements. These include:
- Unguaranteed income and associated benefits
- Being responsible for their taxes and finances
- Administration duties
- Chasing payments
- Marketing themselves
Well, it all depends on the kind of work you want to perform, and the lifestyle you wish to build around it. Businesses will usually choose employees for open-ended tasks, required day-in, day-out, all year round, in order to maintain general running and growth. These set hours and salaries can be exactly what people need to structure their futures. Conversely, contractors are only taken for shorter periods of time, usually seasonally or when a specific task needs completing, such as when an organisation is scaling. This may lead to greater risk, but long-time contractors can assess busy periods and budget accordingly, as well as enjoy the higher independence in managing their affairs.
Looking for Something New in Your Career?
Regardless of whether you operate as a contractor or an employee (or even if you’re looking to switch it up), Strive for Talent offer an extensive range of job opportunities in a wide array of sectors across the world. To learn more, contact us today by calling +61 2 80260596.