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Contractor or Employee? Which is Best for Software Companies?

Article by - 11/4/2021

Software companies have a lot to consider when looking to hire a new software developer. They need to make sure they hire someone with the right skills that will be a benefit to the team. There are a couple of different options that could be considered; employee or contractor. Which one should you choose? Which will be the better choice for your company?

If you hire an employee it may take some time to find the right match, but you can be guaranteed they will be there for the long-haul. However, if you hire a contractor it could be easier to find someone who can meet your needs quickly, but they may not stay on board for too long. Here are some things to keep in mind when hiring an individual for your business.

The Differences Between an Employee and a Contractor

First, let’s look at the definition of employee and contractor. An employee is someone who is hired for long-term work, will be eligible for health benefits, and needs to fill out tax information.

An independent contractor (freelancer) can also be hired for long-term work (0-3 months), is not eligible for benefits, and takes care of their own taxes and payroll. They can be there as long as you need them, and will always be ready to work.

Hiring an Employee vs. Hiring a Contractor

If you hire an employee, you are hiring someone to do a specific job or function. If you find someone who you think is a good fit for your business, you’ll be able to get things done efficiently. However, if you don’t, you could have an employee that comes to work and doesn’t actually do anything.

Full time employees cost more in the long run because they will require on-boarding and routine training to get up to speed with your organization and what is expected of them as an employee.

Contractors, on the other hand, come to your job site and perform a job as requested. They often have top-notch skills and knowledge gained from intensive training programs and certifications. They are an asset to any company because you can utilize them for many tasks. Since they are only hired for certain tasks, they don’t require on-boarding or additional training.

Knowing Your Needs

The best way to determine which one to hire is to look at your needs. Hiring the right individual for the job is an exercise in understanding what the job entails. What type of work do you need done, and will this be ongoing work or will it have a time limit? If you are short-staffed, having an extra person around permanently will offer variety and backup when you need to fill a shift.

On the other hand, if you have enough staff for daily needs, and only have certain projects that require an expert, then a contractor may be your best bet. You can hire a contractor that works on their own, or works for an agency that can be used again and again whenever you need them.

The cost may be a little more upfront, but remember that you are paying for the skills and knowledge this person has that others do not. If you contract with them once and the job was done to your satisfaction, then it was worth it. You can then feel confident to call on them when the next project arises.

Finding Contractors

Finding a qualified contractor is a little different than recruiting a regular employee. There are many places to find good contractors or employees, such as Jobterix.com. It is a job marketplace for IT professionals. You can search by skills and get the profiles of candidates that match what you’re looking for exactly. This eliminates a lot of the hassle and makes it easy to find the right person for the job.

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