From a company/manager's perspective, what are the advantages of hiring a consultant over a FTE?

Question

I've run into a lot of situations where company's and directors/CEOs/etc. are either on the fence about hiring a contractor/consultant, or against the idea. In these situations, they're thinking about hiring a full-time employee. If I find myself in this situation, I don't feel like I have the context or empathy to explain the benefits of hiring me as a consultant over hiring me as a full-time employee. I see the advantages for myself, but not them.

To gain empathy—and sell myself better—I'd like to know the pros and cons of hiring a full-time employee vs hiring a consultant, and I'd like this to be from their perspective, not mine.

Answer 1

To answer the question, you have to consider beyond the headline cost...

With an employee, as well as the salary, you have to factor in (depending on the jurisdiction):

• Additional payroll taxes
• Other health care and/or social security charges
• Sick pay and holiday pay
• Pension contributions
• Training and development
• Provision of equipment
• etc

With a freelancer, there is the agreed rate...

Then there is mutuality of obligation... an employee is obliged to turn up for work, and the employer is obliged to provide it (or at least pay them anyway) - but if there is no work to do, the freelancer likely has other tasks to do. Likewise, with an employee, terms of employment will dictate minimum notice periods.

Equally, hiring managers maybe constrained by headcount limits... or maybe they just want someone for a short period of time, to do a specific job.

In summary, there are myriad reasons.....