Freelancer vs. Company Work: What's the Difference?

Published: 13th May 2009
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Owning your own business creates many hassles. How to get work completed on time and in good order when you can't do it all is probably the biggest headache of them all. If you have access to a large building and lots of materials, staffing a business from the inside and keeping your employees all in one place on a full or part-time schedule can make perfect sense. However, even in the case of such a company there are times when you have the need for a professional not on staff, on a temporary basis, and you will need a resource to find them.

Freelancers are the answer to all your staffing needs. Small to mid-sized businesses can make great use of outsourcing everything from marketing personnel to writing assignments as a way to staff their business without the expense of full-time payroll and other personnel demands. Large businesses can find specific temporary help in skilled areas without having to hire a permanent member to their teams.

These are some of the differences between outsourcing freelance workers and company workers that can help you see the great value telecommuting freelancers can add to your company.


With an Internet freelancing site that offers professional workers in a wide variety of areas, you have the diversity of a large workforce at your fingertips. This allows you to seek the skills of freelancers from IT to web development without adding to your payroll for jobs that won't require long-term efforts. Since freelancers are considered independent contractors by the government, it also allows small businesses access to even long term needs like virtual assistants and writers without the tax implications of hiring employees.

Payroll Cost

When you hire permanent staff, you're locked into an hourly pay or salary rate, not to mention raises and many other expensive requirements. You are responsible for part of their income tax fees, possibly health insurance and vacation as well as sick pay for any full-time staff you have on hand.

None of that is an issue with freelance workers. Being independent contractors, they're completely responsible for their own income reporting (although you will have to file W9 forms for anyone you pay throughout the year and submit 1099 forms to them at the end of the tax year). You're not required to provide insurance, vacation or sick pay regardless of how many hours your freelance worker completes in a given week. Best of all, you're not responsible for giving freelance workers raises.

When you outsource writing, marketing personnel or other freelancers you are also not required to keep them if you find someone who is capable of the same work for less money. Nor are you required to give reason for no longer wishing to work with a certain individual, regardless of your reasons.

Housing cost

If building your business includes hiring full time staff, you will need to provide a place for them to work. This includes office space of one sort or another, but also involves machinery, program/software, office supplies and any other necessities required to complete projects. That is a big expense, whether you're talking about one employee or one hundred.

When you outsource with a freelancer the costs associated with all of their work is solely their own. You save hundreds of thousands of dollars a year on that alone.


A huge asset to using freelancers vs. company workers is flexibility. Even if you hire workers on a temporary basis to work inside your company they will be there for the duration of one project and then be gone, and you will need to rehire more staff for the next project.

With a reliable freelance source, you have a constant supply of temporary workers waiting to assist you when you need them.

Global Access

The biggest asset to freelance workers is you do not have to rely solely on the talent available to you in a local area. This is great no matter where you are, but especially wonderful when you operate a business in a smaller urban or rural area with limited staffing resources. You can outsource everything from staffing management to illustrators that you might otherwise not be able to afford if you had to keep them on your payroll.

So unless you are a member of the Fortune 500, or maybe even in the current economy if you are, hiring a freelancer makes a lot of sense.

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