Hiring Independent Contractors vs. Employees: What You Should Know

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Independent contractors and employees both work for the company that hired them. Sometimes, they may even do the same job, in a different way. However, there are actually several differences between the two that may affect how background checks work.

Here we look at those differences so you may know how to approach the two different types of workers of your company, and how you should conduct background checks before hiring them.

Control

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The most evident difference between the two is that although they both work for the same company; the employer possesses different levels of control on them.

The employer can control how, when, where, and what an employee can do within the company. However, independent contractors can do what they do best, as long as the result satisfies the employer.

That’s why during background checks, employees should be assessed of their productivity, creativity, and things like that, while contractors only need to be checked whether their services are top-notch.

Payments and Taxes

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Employees are paid depending on the hours they worked for the company. However, independent contractors are paid for every task they finish.

In addition, employment taxes are paid by employers while contractors pay for self-employment taxes themselves.

So, you’d better make sure employees have a great history with other companies so employment taxes and benefits will be worth it.

Loyalty

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Employees usually work for only one employer, unless they have time to juggle more than one job. In the case of independent contractors, they can work for as many companies as they want.

This is the reason why you should check the history of independent contractors with completing multiple jobs at the same time because that’s going to be the case most of the time.

Work Hours

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Employees are required to work in fixed hours set by the employer. Independent contractors work their own hours.

If you want to achieve optimum results for contractors, make sure you check first their agency if their typical work hours suit the needs of your company.

Different problemsrequire different solutions. Companies are no exception. Before conducting background checks on an applicant or an agency, make sure first if they really are what you currently need in your company.

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