Last week we discussed how many companies are opting to hire independent contractors, instead of employees. There are many benefits to both the gig worker and the company.
From the company perspective, the overall cost to hire an independent contractor is usually less since the company does not need to pay for workers compensation or unemployment insurance. In most cases, the costs for medical insurance and retirement benefits can be avoided as well.
In addition, the independent contractor usually provides a specialized service, for which they are highly trained. This may reduce the cost of training and allow the company to see measurable results sooner.
Flexibility is another benefit. The company can adjust the hours worked based on specific needs. Multiple gig workers, each an expert in a different field, can be brought in to form a robust team. Gig workers can usually perform much of their work remotely, reducing overall operating expenses.
Finally, effective use of independent contractors may reduce the legal liability to the company. The contractor probably carries professional liability insurance.
There are many potential benefits to the gig worker as well.
Independent contractors typically have more control of their work schedule.
Usually, independent contractors are specialists and it usually takes a fraction of the time to accomplish projects. Since they usually bill by the job, not by the hour, their effective rate of pay can be much higher.
Finally, because they work for several different clients, contractors may not need full-time employment commitments from any one client. This provides additional employment opportunities not available to those seeking full-time employment.
