Are you in need of help in a specific aspect of your company, but unsure of whether you should hire an employee or a freelancer? For long term needs, such as a salesperson for your products and services or a receptionist for your front desk, employees are the obvious answer. But what about short term needs, like one-off or contract projects? In those cases, you might be analyzing the pros and cons of a freelancer versus a contract or temporary employee. In this post, I'm going to show you four ways your business can save time with a freelance workforce over employees.
- Freelancers for specific projects are easier to find.
When you consider hiring an employee, you will have to determine whether it will be a temporary or permanent employee, how many hours you will need them to work now (and how many hours you will be able to employ them for long term if they are permanent), and the qualifications they will need to fulfill their role at your business. You will also have to determine how to define the personality of your future employee so they fit in with your company culture.
Once you've determined these things, you will have to put out a detailed job listing, sift through resumes, conduct one or more interviews with you and other people in your business, review your options, and finally work through salary negotiations. The entire process will take a significant amount of time for you and anyone else involved in the hiring process.
Should you make a bad decision in the end, you will have to go through the entire process again to find a replacement. And this is after you have spent time with your human resources manager or lawyer to ensure you can let the employee go without any issues in the first place.
With freelancers, there are fewer things to worry about. You will typically hire a freelancer for a specific project, one that requires a specific set of qualifications. Since freelancers market themselves in terms of availability, you can skip the job listing and reach out to the people who demonstrate the skillset you need for your project.
While you will want a freelancer you get along with, you don't necessarily have to worry about how they will fit in with your company culture since they do not have to be a permanent fixture within your office space. You don't have to worry about your freelancer bringing in "office drama" or potentially ruining your upcoming holiday party.
Best of all, you don't have to worry about any legal issues surrounding hiring and firing freelancers. If a freelancer doesn't work out, you just pay them what you owe and move on to a new freelancer.
- Freelancers require less HR involvement.
Think about what it takes to get a new employee started at your business or ask your human resources manager. When a new employee is hired, they must be added to your company's payroll system, insurance, cafeteria plan, and 401k. They have to give you their tax information and then sign a non-compete agreement, the employee handbook, and other company-specific documents.
From there, someone has to keep track of the time they are coming in and out of the office, their vacation days, their sick days, salary changes, bonuses, and much more. You pay state and federal taxes for them on a periodic basis. And you have to enforce the rules in your employee handbook in terms of behavior, dress code,
When onboarding new freelancers, your HR department can relax. Freelancers are typically paid as vendors for your business, so there is no need to set them up in your payroll system. Freelancers don't expect you to cover their insurance, health costs, or retirement funds, so there is no need to set them up with those. And, besides a non-disclosure agreement in some cases, there is no need to get them a full folder of documents to sign.
Depending on the type of freelancer you hire and the project you have them working on, you may or may not need to keep track of the hours they worked. In most cases, you're better off paying by the project, such as a completed logo design or website revamp than by the hour. Either way, besides the hours they spend working on your project, there is no need to account for vacation days, sick days, or any paid time off.
When tax time comes, all you have to get from your freelancers is a W-2 and all you have to give your freelancers a 1099-Misc showing how much you paid them. That's it!
As a whole, this will save your HR department lots of time, plus additional expense.
- Freelancers do not need your help training and continued education.
In most cases, employers who want their employees to excel at a particular skill or enhance their education on a particular subject must invest in training and continued education for their employees. This typically involves sending them to conferences, paying for premium training and certification, and contributing to their university tuition.
With freelancers, there is no need for employers to worry about training and education because the freelancer will bring that to the table themselves. Since freelancers are constantly marketing themselves to clients while competing with other freelancers in their space, they are always improving their skillset and education on their own.
- Freelancers do not need you to find them work.
Have you ever been in the position of feeling pressured to find work for some of your part time or full time employees just to avoid having to lay them off? Not only does that add pressure, it takes up time because you have to look at everyone's workload to assess which tasks can be reallocated to others.
You also have to consider the skills and knowledge of those employees to decide whether it would be worth re-training and then moving them to different areas within your business.
Freelancers do not need this kind of attention. You simply hire a freelancer for a specific project, and that is it. Once that project is done, you are not obligated to find them more to do. You do not have to consider other areas where they would be a good fit within your organization. This will take some time and pressure off you as the business owner, or your project managers.
As you can see, there are many instances when choosing a freelancer over an employee is not only best for your project, but also best in terms of saving time for yourself, your human resources department, and other areas within your business. Keep this in mind the next time you are looking for someone to complete specific tasks and projects!