Are you considering a career switch? Been working as an employee for most of your professional life and ready for a new environment? Why not consider becoming an independent contractor? Below we’ll detail the differences between contractors and employees to prepare you for your new life!
Increased Freedom
The major difference between contractors and employees is the level of freedom. Contractors essentially build their own business and work for themselves, and do not need to follow the instructions of an employer. By running their own business and providing the goods and services that they are passionate about, contractors are able to accept the jobs that they are most interested in, and reject those that they are not. This effectively means contractors have much more professional freedom than employees.
Additional Responsibilities
However, along with increased freedom comes additional responsibilities. As contractors are effectively their own employers, they need to take on the responsibilities that employers normally manage. This includes:
- Insurance – income protection in particular is an insurance contractors need to purchase for themselves. Insurance covering their assets and liabilities should also be considered for contractors.
- Licenses – contractors need to pay to renew or obtain the licenses required for their jobs. They may also need to pay for their continued professional development training if it is necessary for their profession.
- Superannuation – unlike employees who have their superannuation contributions paid for by their employers, contractors need to make their super contributions themselves. This means setting aside money for their superannuation and handling the administration work when making payments.
Interested in learning more about the differences between contractors and employees? Need clarification on the added legal responsibilities of contractors versus employees? Make sure to contact the team at Progressive Legal for forward-thinking legal advice!
