When it comes to setting up and running your own successful business, the staff you have on board are key. While this will naturally be based on a bedrock of permanent employees, you may also want to think about using independent contractors. They offer a whole host of different benefits from employing salaried staff and can be a vital tool for many businesses to use regularly.
What is contracting, and what benefits can it bring to your business?
A contractor is simply a person you employ for a limited period of time to complete a set project or fill a role temporarily. Once the set period is up, the contractor terminates their work with you and you pay them any monies outstanding. A key point to note is that contractors are not employees of your company. Many businesses class this as a real benefit as it means that you are not responsible for managing their NI or PAYE contributions.
In terms of how the process works, you would start off as a business by identifying the need for an external contractor to work for you. When this is done, you could hire one directly or go through a recruitment agency, who takes this work away from you.
After you have found a contractor you want to use, you would negotiate with them or their agency over hourly rates of pay, working hours, and what the role involves. Once everyone is happy, contracts would be signed to make the arrangements legal, and they would complete the work for the agreed period.
One top tip when hiring contractors is to look for those who use an umbrella company to manage their own payroll. While this is not a legal necessity, it makes using contractors much easier.
Instead of having to process timesheets, deal with queries and pay them yourself, the umbrella company does it all for you. You simply pay the agreed monies to the umbrella company. The umbrella company then deducts their fee and any PAYE contributions before passing it on to the contractor or agency. This also gives you an objective third party to speak with if there are any issues over the contractor’s pay or contract.
Now that you know what contractors are and how they work in general terms, you may be wondering what benefits they bring with them. Here are some of the best ways that they support business growth:
While permanent staff play a pivotal role in any business, external contractors also have a big role to fill. They offer a variety of different solutions to common business issues and in a more agile, controllable way. If you use a contractor who is registered with an umbrella company, then you get all these benefits with none of the hassle over payroll. For most businesses, this makes contractors a viable staffing choice.
Nov 29, 2018 0Contract Management is the organization of contracts a...
May 14, 2018 0Kiera Louise runs one of Manchester’s top makeup...
Mar 21, 2017 0Starting a general home improvement project can work like...
Nov 12, 2018 0