In recent years, hiring workers as independent contractors seemed to catch on. It allows small businesses to hire a lot of workers without having to worry about things like over-time and benefits. However, this business model seems to be fading amongst new start-up small businesses and there are many reasons why such as creating a long-term employee/employer relationship.
New businesses are shying away from the old model of hiring workers as independent contractors mainly because they feel that by creating good jobs, they are creating invested employees and therefore will get a higher quality of work and employee loyalty from their employees. By hiring employees instead of taking on independent contractors, some small business owners feel that they can secure the best people in their field and in turn, those individuals will provide a better service.
Independent contractors are treated as their own businesses and are therefore responsible for their own expenses and taxes. As a result, they are granted autonomy. That means businesses that hire them may find it difficult to tell their workers how or when to do a job. A good example of this is if you hire a web developer to build you a website. You would be hard-pressed to find a way to tell them to work on your website only during the day when they are fresh.
The problems associated with hiring an independent contractor stem from this autonomy; because there is no way to tell them how and when to do the work, it is problematic to train and schedule workers, making an independent contractor workforce sometimes impossible to deal with especially in certain types of businesses. Businesses like Uber that rely solely on the work of independent contractors find it difficult to maintain quality on the rides that their drivers give and also may lose out on revenue because certain busy times or locations are not staffed.
For this reason, some small businesses are leaning towards hiring their workers as employees; but this is not without its faults too. Some businesses are changing their independent contractors to part-time employees, which can be troublesome for those who relied on the flexible scheduling that being an independent contractor allowed. This is especially true for those who have more than one job. Also, those hired as a part-time employee—those who work less than 30 hours a week—may find that they lose valuable working hours. Also, by keeping a part-time work force some businesses get around having to pay benefits such as health insurance. This type of system assures that the business has better control over their employees while removing some, if not all, of the perks of being an independent contractor. Although the trade-off might be gaining job security. As an employee, a worker is already hired for the job and thus they know that they will have a steady stream of work—something that may not be true as an independent contractor.