Hiring Independent Contractors

Tips From a Contractor’s Point of View

by Julie-Ann Amos

Julie-Ann Amos is a freelance consultant within business, management and human resources. She has worked in the RAF, the public sector, retail, recruitment and banking – in as far locations as New York, Hong Kong, Scotland, and the Falkland Islands. Currently, she works part-time, consulting with a banking institution in the City of London, and freelances during the rest of her time. She is the author of a number of books published by How To Books on management topics. She lives in London with her husband, a wonderful garden and a small menagerie, including a Siberian Husky, and a very helpful cat who likes to type and play computer games!

Independent contractors, freelancers and experts have one advantage over employees – they cost less. You pay for them when you need them, and put them back on the shelf (where they work for other clients or wait for more business) between projects. There are no overheads unless they work on-site for you – you don’t have to give them an office space, electricity and heating, benefits, pensions etc.

But before you rush out looking for contractors, think things through! A little consideration can save your pocket and get you better results.

Threats and worries
Employees are unlikely to co-operate with contractors if they feel their jobs are threatened. A decision to use a contractor may be viewed as an experiment to assess losing a permanent job. Employees’ own work may be unrelated to the contractor but they may still spend more time feeling threatened than thinking about how to do good work. Demotivated staff rarely perform well.

The Big Benefit
Apart from cost, contractors have one big advantage – if you choose the right one, they are expert at what they do. They usually don’t offer to do work they will struggle to do, as it simply isn’t cost-effective for them. They get paid on performance, so they tend to perform well and maintain their skills at a high level.

Cherry-picking
Some jobs are more interesting than others. Giving all the best projects to contractors demotivates employees. But giving contractors really mundane, boring work may attract only mediocre or poor quality contractors. On the other hand, it might cost you a high price to get a good contractor to do work which doesn’t warrant their skill.

Keep the Good Ones
When you find a good contractor whose work you like, consider putting them on retainer or contract. Agree a rate and contract to go to them first with each new project. You may get a better rate if you can guarantee a minimum level of work over, say a year. It may also be worth paying a small monthly retainer for reduced price work when required.

Specify EXACTLY What You Want
Agree with the contractor the outcome required. Agree what you will and will not provide, and expect to get. Costs need to be agreed and recorded, but just as important is the specification of what you want so you aren’t disappointed by the result.

Consider a Contact
It can be helpful to give a contractor a point of contact to approach with any questions or queries. For some projects where a lot of information or data is necessary, you may even need a secondary point of contact to cover absences etc.

Encourage Ideas
There is no rule that says the project you wanted was the best idea out there! Maybe your contractor can think of a better idea – and you’ll never know unless you have a dialogue, whether it be by telephone or e-mail. Encourage feedback on the project specification, and new ideas.

Be a Good Client!
Contractors work for themselves, so they are free to pick and choose projects and clients. If you are too demanding or unreasonable, hard to get hold of or keep changing your mind, a contractor may decide they don’t want to take further work from you. Pay promptly, as contractors rely on a steady stream of projects instead of a fixed regular pay check. Delayed payments may make you unpopular, and almost all contractors fear clients who just won’t pay up!

Other Clients
On a similar note, remember your contractor may well have other projects for other clients in progress. You have less control over this than with an employee. But if you are their client of choice, they will be loyal to you and put you first when conflicting demands arise. Treat them well and they should respond in kind.

Don’t Equate Fees to Wages
Contractors earn more than employees because they have no benefits etc, and have to cover their own expenses. Don’t try to equate a contractor’s time to the cost of an employee’s. Remember, you are only paying for the contractor when you use them, the rest of the time they cost you nothing – they are not an overhead.

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