How being an Contractor is different to being an Employer

There is always a stage in your career where you ask yourself whether to remain an employee or be a contractor in a firm. At that time you might contemplate that how your life would be being an employee and being a contractor.
If you choose to be an employee, you always have a safer side that a fixed amount is getting credited on your bank account but you also have to work under your boss.

But if you start your career as a contractor, you will work independently and have to work on a project-based salary. So let’s look the advantages and disadvantages of both of them, and let’s find out the difference between Employee and Independent Contractor.

When it comes to hiring a person to perform a task, we have 2 options available: Employee and Contractor. Employees and contractors come before the business person to perform a task. Employee provides service to the employer in exchange for some salary, but on the other hand, the contractor provides service in exchange for a definite fee to an employer.

It is very difficult to compare the two as both have advantages and disadvantages. If we have to perform any task, then we cannot choose between the employee and the contractor, who can do the task better. But when you understand the difference between Contractor and Employee, then the process of selecting both will become easy.

Both the terms are very different from each other whether it is in terms of relationship, independence, in terms of work or in terms of salary or in terms of time also.

Meaning of Employee and Contractor

An employee is a person the employer hires to perform a job regularly, and he has to work only on the salary fixed by the employer. At the same time, the contractor is a self-employed person who provides service to the organization on a project basis salary.

Income of employee and contractor

An employee works on a fixed salary whereas a Contractor works on a project basis salary.

Employee and contractor work for?

An employee gets tied in a bond in case of work, due to which the growth of his skills is very less. But the contractor works in conjunction with many clients so that his communication skills improve his working skills more.


The employer provides inputs for the employee to work, but the contractor has to apply the inputs himself.


An employee has to work under the direction and control of the employer, but the contractor works independently.

Time and place

The employer fixed the time and place for the employee to work. But the contractor works at the place and time fixed by him.


An employee receives training for performing services in a particular manner. A contractor does not receive any training from the contractee.


An employee has a continuing relationship with an employer, but on the other hand, the contractor has a temporary relationship with the client.


An employee can work on only one project simultaneously, which the employer decides. But the contractor can work on many projects at one time.


The employee cannot delegate the task to another person, while an independent contractor has the right to delegate tasks and duties to his/her subordinates.

Payment expenses

The expenses made by the employee during the performance of the task are borne by the employer, unlike independent contractors, who are responsible for bearing the expenses incurred during the performance of services.


Before deciding your career aspect it is important to first realize what you exactly want and what all are your expectations with your career and life. By making a particular decision it is very important to analyze yourself first.


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