Differences Between Employee and Independent Contractor
A worker can be categorized into two categories, the first category being an employee and the other independent contractor. Anyone starting a business for the first time may not be aware of the types of workers. In the event that you are joining staff somewhere or starting your own business, you should note that the types of workers have many variances. Apart from variances, see to it that you know the benefits and demerits of an independent contractor and employee, click this website. Continue reading to discover how employees differ from independent contractors, click here! .
To start with, one of the best ways you can differentiate the two types of workers is by looking at their tax situation. An employee has the benefit of their brunt of tax-related paperwork handled by the employer. On the contrary, the disadvantage is that the employees are given payroll taxes.
An employee differs from an independent contractor in that an employee I was given a consistent wage. The fact still remains that the employees will be recognized and the permanent assets of the employee and therefore have specific benefits like the healthcare plan. Among the packages that they enjoy include; specialized training, severance package, and workers’ compensation.
More often, an employee is subjected to a tight work schedule suggested by the employer. As an employee, you can find this disadvantageous or advantageous, check it out!. You may find the tight schedule limiting, or you can use it to your own advantage and be more productive.
When it comes to an independent contractor, the advantage is that you have more freedom and, therefore, a great choice if freedom is among your priorities. Despite the freedom, the challenge is that being an independent contractor requires more responsibility. As an independent contractor, you have full responsibility for your tax documents, and this can be overwhelming.
Take keen consideration that as an independent contractor, you are self-employed according to the international revenue service. Regarding independent contractors, you are not consistently paid, but you can be sure of the payment once the job is completed. So long as the work is done as per the required standards, you are always sure of getting paid.
As much as the employee has essential benefits like a healthcare plan, an independent contractor does not get to enjoy such benefits. In the case that you own a company, you may benefit from this fact, but when you want to join a workforce, it may be a limitation, especially if you don’t have a healthcare plan. In conclusion, before you start a business or join work, ensure you understand the differences so that you can make an informed decision.