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Ask Slashdot: Employees or Contractors?
gurn submits this item for discussion: "Here's my challenge, I currently managing the development section of a small Consulting Firm. All of the developement efforts are being handled by contract employees. They have announced that they are going to start expanding aggressively and as a result need to ramp up quickly - especially on the development side.. The president of the firm is uncomfortable with the developers being contractors, while I think it is the only way to get the best people. My thinking is that those that really know their worth and have high skill levels tend to be contractors. What do other companies do? What is your experience with contractors vs. employees? "
I am a Project Manager in a Contracting Company, so probably I am biased in their favour.
Anyway, Contractors come in various shapes, just like the employees do. You can find contractors who will work 9-6 and you can find contractors who will more commitment to the company/work than a regular employee.
Advantages of Contracting:--
1. You do not need to hire and fire people just to get enough headcount for the peak development phase. Someone else handles the headache for you.
2. Although you are paying more than what you would pay to the regular employee, when you count the costs of Human Resources Management, Technical Training, 401, Vacation, Sabbatical, Stock Options etc., it does not end up being much more.
3. Many contractors do come with a better expertise of the functional area you are interested in.
Disadvantages (reasons/solutions):--
1. Loyalty. If you asking for a person to work with you for 3 months, you do not expect that person to be more loyal to you. And why should you??? However, I have seen contractors working for a single client for multiple years and being a strong part of the client team.
2. Employee Satisfaction. When an employee notices a contractor earning more than him/her, it is not bound to leave a good feeling. However, as long as they understand that the contractors are temporary and justified for a particular requirements, AND not a threat to their jobs, this risk can be mitigated to some extent.
3. Code quality. I put that in as a joke. Code quality is as good as the deadlines and/or the application design, irrespective of whether the coding is done by an employee or a contractor.
4. Loss of expertise once the project is over. Yes, once the contractor leaves, the expertise is gone. But should you not have some employees in the project?? Or some long term contractors?? At least one of these is essential.
Othe Perspectives:---
I come from a company which believes in offshore development. We do most of the work in India, while keeping about 10-30% of the manpower at the client side. Since the costs of doing work in India are about half the costs of doing work in US, the cost issue becomes moot. Also, part of the management headache is passed to the consulting company. And since we are commited to working with an offshore model, we put in much more effort to make the offshore work a success. This model is great for large project teams though may not be suitable for small projects.
Anyway, please do not treat this as a promotion for my company. I am a regular slashdot reader but this is the first time I though I would be able to contribute something to the discussion. You can write to harry_ruby@hotmail.com to discuss any other aspects of this issue. I would rather not get company email to get flamed.
PS: I have worked for 4 clients in my 8+ years in this industry and have been involved with the current client for more than 3.5 years. As a contractor.