Concept · Talent and hiring

Contractor vs employee

Also called: contractor, employee, freelancer, independent contractor, 1099, W-2, agency, dev shop, independent contractor agreement

A contractor is an outside person or firm you pay for a defined piece of work, and they decide how to do it. An employee works for your company on an ongoing basis under your direction. The law treats the two differently for taxes and benefits, and the label you pick does not settle which one a person is. Common Paper publishes a free, standard template for hiring a contractor (Independent Contractor Agreement).

For example: You pay a freelance developer a fixed price to build the first version of your app. That is a contractor. You hire a developer on salary who works your hours on whatever you assign. That is an employee.

Connects to 16

• Scope Concept
• Intellectual property Concept
• Technical co-founder Concept
• Common Paper Tool
• CTO Concept
• Recruiter Concept
• Offer letter Concept
• Payroll Concept
• Moonlighting Concept
• Retainer Concept
• US Department of Labor Government
• Clevyr Organization
• Oklahoma Employment Security Commission Government
• Fractional executive Concept
• Fractional COO Concept
• Staff augmentation Concept

This glossary is plain-language orientation, not legal or financial advice. Before you decide on a company structure, a contract, taxes or a fundraising deal, talk with a lawyer or an accountant.