Contractor VS. Employee: Who Dominates?

Author: Ben Buie Ben Buie | 12/29/15

It seems like everyone is looking for web developers these days.

Being a developer, I get lots of questions in these 4 categories: (1) my development skills, (2) my contractor rate, (3) my work location (on site or remote), and (4) my willingness to be an employee again.

My skills usually start the conversation and I’ve tried to make it easy to review them by project, skill, or client. In addition, I’ve already addressed my contractor rate in a couple articles: good development isn’t cheap and the importance of good development.

In this article I want to talk about #3 and #4: why every company needs a contract developer like me, despite the fact that I only work remotely and don’t want to be an employee.

Here is a quick list:

  1. A contractor relationship produces high quality work
  2. A contractor can be cheaper than a full-time employee in several ways
  3. With a contractor, you only pay for billable hours
  4. A contractor can fill in employment gaps
  5. A contractor can offer help to meet deadlines
  6. Contractors are great on projects with short-term needs and uncertain futures
  7. Technology makes working remotely easy and transparent

Contractor Relationship Produces High Quality Work

Have you ever noticed how good the customer service is at the mom-and-pop restaurant near your house? Why is it so different than the drive-thru window at Taco Bell? For one, mom-and-pop know that keeping you happy keeps food in their bellies and a roof over their head. That ratty haired teenager at the window, however, couldn’t care less about your service, that is, unless his clip-board carrying boss is looking over his shoulder.

I’ve heard people say that you have to bring people “in house” to get them to really commit to your project/startup. Does commitment lead people to produce their best work? Our initial reaction is yes, but I’ve found an equally, if not more powerful motivator: mom-and-pop’s fear of not having someone to enjoy their sushi.

Or, in my case, my code.

If you’ve never worked for yourself, then you may not know the feeling that your work could end at any moment. This feeling is quite possibly the best motivator I’ve ever experienced.

This feeling leads me to constantly question if I’m providing enough and the right kind of value. To answer that question, I track my time religiously, meticulously, and at the end of the week I tally it all up (actually I use Toggl to do that) and review it. Then, I always ask myself, “Self, is this client going to be happy paying this?”

Luckily, the answer is yes most of the time. I absolutely hate the feeling of sending a bill when I wish I’d provided more value. I know that if this becomes the norm, I may not have food in my belly and a roof over my head.

I’ve experienced this feeling, to a certain degree, working for other people, but it wasn’t until I ventured out on my own that I experienced it deeply. I can tell you this, my work has never been so good.

Contractors Can Be Cheaper Than Employees

Most hiring managers realize that contractors don’t require benefits, employment taxes or payroll, on-boarding, or training.

Most managers, however, don’t realize that there are a couple other reasons why contractors are cheaper…

Think about it, you’re free to send me work (or not) at any moment. There are no string attached! There is no check that is automatically cut and put in my bank account.

My clients use my services only when they need them. This reason alone saves my clients thousands of dollars a year while not sacrificing the technology they need to drive their businesses forward. Quick bursts of work followed by pocket book silence.

Not only am I a resource for your team that can be engaged quickly, I also have my own equipment. I work with a state of the art workstation that I use with either a Mac or PC. I have an iPhone and iPad for testing and will soon be buying an Android. I sit in an ergonomic chair and have a standing desk. All stuff you don’t need to buy. 🙂

Just send me a link to your git repo and we’re running. Oh, and I don’t take up space in your office.

You Only Pay For Billable Hours

If you analyzed the number of hours an in-house developer is making you money, you’d probably find that even the best are only “on” 80% of the time. The other 20% is filled with pointless meetings, water cooler chatter, in office banter, and watching the latest cat video.

I’m not saying that these things are useless (except for maybe the cat video); I’m just pointing out something you probably already know: even though you’re paying for 40 hrs a week of work, you’re only getting 32 (if you’re lucky).

With me, you only pay for the portion of the 32 that you need.

Deadlines

Deadlines are often a function of business needs, not team resources. The truth is, companies live and die by deadlines.

That said, they aren’t always good for producing the best quality code. Sometimes, they cause us to make trade-offs that may not be desirable, like just making the code work rather than sculpting it into an eloquent piece of technology. That is not to say that deadlines are bad, they aren’t, but having a resource that can help you meet it effectively is valuable.

A good contract developer can be up and running on a project in hours, not weeks, and can provide you the extra man/woman power you need to meet the deadline and still produce quality, functional code.

If you could use some help from time to time, let’s do a small project together so when the deadline is looming, I can swoop in and help you dominate.

Employment Gaps

I remember when I got hired at one of my previous companies, they decided to add an employee because they were swamped. The problem is, they had too much work for three developers, but too little for four. It didn’t take long before the company had nothing for me to do. After a slow 3 months, things started to speed back up and then became overwhelming for a while before we hired again.

This cycle is a good example of the fact that, hiring is typically slow while business needs are urgent. So, companies go through periods of intense work before they hire and after they hire they go through a short period of too much labor.

Maintaining a good relationship with a contractor can help your team manage the periods of intense work longer. This means a happy team!

Short-term Needs With Uncertain Futures

One of the companies I’m working with right now, we’ll call them GameChanger, is bringing an old technology to an new industry. They’re in the beginning stages of their business and they have a limited budget. They could hire a full-time developer, but then they’d be burning cash every week even if their needs slow down temporarily. They’d also need to invest time making sure the employee had a full queue of projects.

Rather than hire, GameChanger reached out to me for some short-term help. I did a ton of work on their site over a two week period, creating a minimum viable product, and now they’re using it to pitch potential customers. They’ve already landed one. Nice work!

Contractors are ideal for this type of relationship. Rather than needing to manage a full-time developer they get quick bursts of work only when it is needed.

Technology Makes Remote Work Easy and Transparent

I’ve been doing contractor work since February of 2015. I’ve worked with about 18 clients so far and of those clients, I’ve met only a couple face-to-face. I laugh sometimes because I’ve never seen a couple of my best clients in person.

This type of work would not have been possible even 5 years ago, but the time has arrived. To make this work, I use all types of communication. Here are just a few (in order of frequency): email, phone, text, chat, hangout, skype. For managing projects, I use all types of software including trello, basecamp, jira, asana. I also use several code repositories: github, bitbucket, springloops. And finally, I use uxpix for wireframes.

These technologies increase the speed and accuracy of my communication.

Lastly, for transparency I use Toggl. I track every minute I work and send you a summary of my projects. This summary looks very similar to the requests sent and gives you a line by line breakdown of how your money was spent.

In my mind, over-communication is a good thing and I’ve received good feedback so far.

Conclusion

I guess I should answer the original question I asked. Who dominates, employee or contractor? Both. 🙂

As you go about building your team of stellar in-house developers, don’t forget that contractors can be a valuable part of your secret sauce.

About The Author

Ben currently works as a senior developer and technical business consultant outside of Boulder, Colorado.

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Buink Web Development is a development shop founded in 2009 by Ben Buie. For years, Ben built and modified web assets for clients in Utah. In 2011, he moved the company to Colorado and in 2015 he started taking on new clients full-time.

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