All You Need To Know About Independent Contractors vs. Full-Time Employees

employee management full-time employee independent contractor Jun 01, 2022
Independent Contractors vs. Full-Time Employees

You probably have experience working with independent contractors as a small business owner. While there are certain advantages to hiring independent contractors, converting those contractors to full-time employees is crucial for business growth.

But when is the best time to convert a contractor to an employee? 

To answer this question, it's essential to consider your organization's vision and the responsibilities that you have individuals undertaking. It would be best if you also learned the legal differences between an employee and an independent contractor.

Fortunately, the IRS has a three-point test that can help you determine what makes someone an employee versus what makes them a contractor. Here are a few examples of questions you can expect to find in the test:

  • Do you dictate this individual's start hours?
  • Do you dictate how they get their job done? 
  • What is the level of control that you currently exert over this person? 
  • Do you have the budget to provide an individual with employee benefits? 

Location is also crucial. Some areas are more stringent about independent contractor relationships, and in some cases, contractors are actually seen as employees. 

Do you want to learn more?

Tune in to this week's episode of 'While We Were Working'!

Joey and Sommer discuss the transition from contractor to employee as you look to build your team, the pros and cons of hiring contractors, and the benefits of having your first full-time hires.

Sommer and Joey also share their thoughts on Roe v. Wade and its impact on the workforce. You'll learn how to manage sensitive topics as a small business leader and how this news could impact your workforce.

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