3 Benefits of Hiring Freelancers For Your Business

Do you know the benefits hiring an independent contractor can bring to your business?

The other day I was having a conversation with my friend Barbara Business-Owner.

She runs a law firm in her hometown and she was expressing her frustration in building a website from scratch.

“Barb, why don’t you just hire a freelance web designer?”, I asked her.

She looked a little confused…

“I’m not too sure, I’ve heard horror stories about other businesses getting audited after hiring an independent contractor. The last thing I need is the Department of Labor breathing down my neck. Or better yet, the IRS!”, she sighed.

The thing is, this is a conversation I’ve had with so many business owners. Not just Barbara!

It’s important to understand the benefits of hiring freelancers, while also understanding how to avoid the risks associated with them.

In today’s post, I’m going to relay benefits I shared with Barbara Business-Owner about hiring independent contractors.

There are three major benefits that hiring an independent contractor will allow you to leverage:

1.     You can fulfill short-term projects without the long-term commitment.

Have you ever wanted to take on a short-term project for your business but you didn’t have enough hands to take it on?

Or you want to hire someone on an “as-needed” basis. But it makes little sense for you to pay someone a wage each month if there are no projects to fulfill.

Hiring independent contractors allows you to take on as many or as few projects as needed. All without worrying about paying wages or other expenses!

2.   More cost efficient than hiring traditional employees.

As a business owner, I’m sure you know all about the endless costs that come with hiring traditional employees.

Expenses such as employment taxes, buying the latest and greatest equipment, and health insurance and other employee benefits.

Well, independent contractors are responsible for paying for their own taxes. They also come with their own equipment and tools required for them to carry out their tasks.

And– this may be the greatest cost-savings of all–but independent contractors are not entitled to the same benefits as employees. This includes things like sick pay, healthcare, and more.

Axing these expenses allows you to use the extra cash flow for other areas of your business.

3.   Ability to diversify the skills of your current workforce.

Another great thing about hiring independent contractors is that a whole ocean of diverse talent is readily available to you.

Let’s say you’re running a law firm. If you need to build a website, I’m sure you could build one…but it would be much better if you hired a freelance web designer to do it.

Freelancers can bring valuable skills and experience you might otherwise not have had access to. These skills can complement your existing team and allow you to enhance your operations and achieve your business goals more efficiently.

A Word To The Wise

As great as this all sounds, it’s not exactly simple.

Yes, leveraging the skills, experience, and expertise of independent contractors can enable your business to run much more efficiently.

However, there are risks you should know.

I wouldn’t want you to jump off the ledge into the independent contractor pool– and end up facing the heat of an unexpected audit.

There are times when hiring an independent contractor is the best option. Meanwhile, there are times when employees are needed.

As a quick example, let’s use my friend Barbara Business-Owner as an example.

She runs a law firm.

If she wants a website to be designed, that’s a job for Frank Freelancer.

However if she needs additional lawyers to take on a huge case, she would need to employ Emily Employee.

This is due to something called “the nature of work”, which essentially dictates the kind of work independent contractors are allowed to do.

Hiring freelancers has become a huge trend among businesses.

That’s great!

But it’s now more important than ever to have a sound understanding of the risks of hiring independent contractors.   This way, you can leverage the benefits while avoiding trouble.

To hire independent contractors without the pitfalls Contact us today to make a customized plan for your workforce needs.

ClearPath is a leading Human Resources Outsourcing company focusing on assisting employers to leverage the independent contractor labor market. We’re committed to helping business owners stay compliant and minimize the risks associated with their contingent labor requirements.

No Legal Advice Intended. This article includes general information about legal issues and developments in the law. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and must not be taken, as legal advice on any particular set of facts or circumstances. You need to contact a lawyer licensed in your jurisdiction for advice on specific legal issues.