IT Employment

When a contractor is offered a full-time job

Find out the reasons why a contractor may be offered full-time employment.

A TechRepublic member emailed me to get my opinion on a situation she is currently facing. She has been doing contract IT work for a company for several months. The company recently offered her full-time employment. The problem is that she doesn't like the work environment of the company, and she feels it's critically mismanaged and poorly organized.

My advice was that she was under no obligation to accept the position but to prepare for the fact that she may be phased out as a consultant. This might happen not because of sour grapes on the part of company management, but because there are legitimate employment law or tax-related reasons that they need the position to go permanent.

The contractor's relationship with the company could be blurring some lines between what is considered a full-time employee and a contractor. Facts that provide evidence of the degree of control and independence fall into three categories, according to the IRS' web site:

  1. Behavioral: Does the company control or have the right to control what the worker does, and how the worker does his or her job?
  2. Financial: Are the business aspects of the worker's job controlled by the payer? (These include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
  3. Type of Relationship: Are there written contracts or employee-type benefits (i.e., pension plan, insurance, vacation pay, etc.)? Will the relationship continue, and is the work performed a key aspect of the business?

About

Toni Bowers is Managing Editor of TechRepublic and is the award-winning blogger of the Career Management blog. She has edited newsletters, books, and web sites pertaining to software, IT career, and IT management issues.

13 comments
aynurhal
aynurhal

First question you ask yourself. Is it your dream to become a contractor? I've been in this situation, and most of them, offered fulltime position, for their advantage. Choose wisely. Right now, i am fulltime employee, and I don't regret it a bit. Cause this company, has open and bright atmosphere, and very good working environment, excellent friendship between co worker. But again, I did not dream to become an IT contractor, just because at that moment, i didn't have good employer, like right now.

ehbeitz
ehbeitz

Some years back I was a contractor for a software developer and had been their consultant for more than 4 years. Many of the key areas of their product were my work. Their financial underwriters asked me to join the company and made me an offer that was really hard to refuse. I joined them in a senior role and relocated so as to work at their head office. To my chagrin, I found that as an employee I could not achieve nearly as much as I had as a consultant. Sadly, the company went out of business, and I found myself out on the street 1000 miles from 'home.' Had the management listened to me they might still be in business!

steve
steve

I've had contracts where I was not permitted to work for the client except through the head-hunting company for a restricted period. Check your paperwork.

Sterling chip Camden
Sterling chip Camden

I've been offered full-time employment several times by clients, and I've always politely declined. The relationship is much better if we keep it client/vendor instead of employer/employee. Since I always have more than one client, I don't have a problem with the definition of employee.

geoamyk
geoamyk

I was hired to be a full-time, on-site contractor for a client of a small IT company. While working there I was offered a fulltime job by my client after 3 months, but turned it down. Since then, my relationship with that client has turned stale. the IT company that hired me has also struggled to find a place for me, though they have kept me on. It is now clear to me, that the IT company I thought was the better organized, and with better leadership and vision was actually just as mismanaged as my client's organization. The main difference was that my client's organization has 200% better benefits. Hindsight is 20/20.

gary
gary

When a client offers a full-time position to a contractor is it always in the best interest of the client. Unless the contractor is desperate for money, there is absolutely no advantage for him or her. Of course, the money, professional recognition and freedom from the obligation of finding new clients are wonderful, but a contractor is a contractor and I doubt that a contractor who is making a living will be ever to completely comfortable in the role of "employee". You burned your bridges once to become a contractor. Are you going to burn them again to become an employee? If so, arsonist may be your true calling in life.

Brad Egeland
Brad Egeland

Another reason may be purely financial as contractors are usually paid out of a different bucket than regular full time employees. But I completely agree with you that this contract should prepare to be phased out if she chooses to not accept the offer. -------- Brad Egeland IT/Project Management Consultant email: brad.egeland@gmail.com email: brad@bradegeland.com website: www.bradegeland.com Project Mgmt articles: www.pmtips.net/author/brad/

Aaron
Aaron

If you contract to establish whether you want each other (Try before you buy...) then you have to evaluate any offer based on your own acceptance criteria. If you wanted to see what the organisation was like, and find flaws with them, accepting an offer (flattering though it might be) is a bad move. If you are a contractor and have impressed the client so much that they make you an offer, you are just doing your job and there shouldn't be a question about accepting an offer, especially when you can identify the flaws in the company from without.

bmwwaterman
bmwwaterman

Contracting is sometimes a try before you hire situation. If you and the company are in agreement with you coming onboard, then go for it. However, if you have second thoughts, then truly ask yourself why. And be honest about it too. Follow that inner voice. As the old saying goes; "When the feeling is there, the facts don't matter." Some of you know what that phrase means too! Yes you might get let go after a certain point. But you knew that when they brought you onboard. I think there is more information or facts we don't know about here. But this is my two cents.

JamesRL
JamesRL

I got a contract and then a second through a placement firm at a major bank. The bank was very happy with my work. There was talk of bringing me on permamanent. But then the end of the fiscal year came and the bank took that placement firm off of their 'preferred vendors list' which meant not only would my contract end, but they would also not be able to convert me to perm. A number of other placement firms had positions there and offered me the opportunity, saying don't worry about the clause, it won't stand up. None of them got me an interview though. James

JamesRL
JamesRL

Depends on many factors, including market rates. In my experience as both a contractor and a hiring manager, in good times contractors salaries can go up faster than full time, and there is a premium paid to contractors. The reverse is often true in hard times. Some contractors get tired of contracting, or wish medical benefits or some feeling of permanence. Employers often want to retain contractors who have learned about key systems or have scarce skills. I went from contractor to perm twice. I've also turned down perm offers while contracting. James

mike21152
mike21152

I've been on both sides of that. Temp-to-perm can be good for both contractor and employer, just to see what the work relationship turns out to be. Of course, it's always "at-will" no matter what you're doing. Temp to perm is like being engaged; the expectation is that you will "get married" sooner or later. But, if you don't like the work environment, say "ta-ta".

nytephenix
nytephenix

I agree with you there. I have been on both sides of this, and definitely like the contracting side of it more. Sure the benefits of being an employee are nice, but I work as a contractor right now and get to enjoy more time at home, not having to work the full time hours of being an employee. Also the pay tends to be better as a contractor especially in the IT field. I mean I work about 25 hours a week and make what I would have to put in a 40 hr week as an employee, because most of the jobs I look at don't start over 14 an hour and 25 an hour as a contractor for about 2/3rds of the hours is decent. I do mostly field work, and don't have any certs.

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