6 Reasons Why Your Small Business Might Benefit from Freelance Workers

If your small business is growing much more quickly than you expected—or you temporarily need help from professionals with specialized skills—freelance workers might be a smart option for you. Here’s why:

Flexible labor and benefits costs. Hiring a full-time employee with benefits can be a big commitment for any small business — but hiring freelancers may be a more flexible choice. “When you bring in freelancers for projects, you only pay for the work you need,” says John Reed, senior executive director of the staffing company Robert Half Technology. “If your workload diminishes, you can simply let the freelancer move on to his/her next assignment with no further obligation on your part.”

The chance to “try before you buy.” Even though you may put job candidates through a thorough application and interview process, it can still be tough to know if a potential employee is right for your company until you actually see the worker in action. Hiring someone on a freelance basis gives both you and the worker a trial period before you make an offer of full-time work.

Access to top (often young) talent. Millennials tend to be desirable employees because they are tech-savvy. And, according to Reed, many of these 20-something-year-old workers are proactively choosing contract work as a flexible, long-term career choice—not just while they’re between jobs. As such, if you want access to some of the top minds, you’re smart to look for them in freelance circles or through staffing agencies.

Quicker hiring time. Because you don’t necessarily need to scrutinize freelance workers as intensively to find the “best possible fit” for your company, as you would full-time hires (though you might want to anyway, depending on the job), you can select them and get them working for you quickly. Reed suggests getting referrals for freelancers through current employees, colleagues who do similar work or professional associations. If you’re too swamped to do any searching, staffing agencies can also do the job for you.

Simpler pay processes. Since contract workers aren’t full-time employees, you’re not required to withhold taxes, insurance, and other line items from their paychecks, nor will they be covered by your workers’ compensation plan. However, you should still make sure you understand and abide by IRS rules and regulations regarding hiring and paying independent contractors.  It’s also smart to check in with your business insurance agent, and consider carrying employment practices liability coverage—just in case. EPL coverage can help protect you in case an employee or a contractor files a lawsuit against your company.

The offsite advantage. If you’ve got a small office or retail space, you may not need to make extra space for freelance workers. For example, web designers or specialized programmers often work from their own home offices with their own top-of-the-line equipment. However, Reed suggests having clear expectations about how you’ll oversee an offsite freelancer’s work. Will they meet weekly deadlines? Will they be required to attend regular update meetings, either in person or by videoconference? What work milestones will they be required to meet before you pay their invoices?  The Small Business Administration (SBA) suggests drawing up a detailed consulting agreement so everyone is clear about job expectations.

This guest post comes from the editors of The Allstate Blog, which helps people prepare for the unpredictability of life.

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 Photo Credit: Sean MacEntee


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