Contractors vs. Employees
Contractors can be a better option because it saves the employer in costs. An independent contractor typically operates under his/her own business name and supplies their own materials, therefore, saving the employer in labor and material costs. Employers also don’t withhold taxes from payments to independent contractors. Hiring an independent contractor vs. an employee also means less liability for the employer. If anything happens, the liability is on the business that the contractor works for.
Full-time employees are a better option if the employer wants someone to work for them long-term, or wants the employee’s sole focus to be on their business as employers have more control over employees such as restricting how they perform their work. Employers must be careful not to treat independent contractors like employees or they may be liable for back taxes on those individuals.
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