Remarkable Business Benefits of Opting for Licensed Independent Contractors


 As a business manager operating in a competitive environment, you’d be well aware of the highs and lows of demand in the market. The ‘big project’ can land in your lap anytime and require you to seek services from domain experts who might not be on your payrolls. These independent contractors enable you to grab opportunities of scaling up and catering to market requirements which you might not otherwise have the expertise for.

In the past few years, it has been seen that licensed independent contractors have suggested themselves as popular choices over new recruitments of employees for the workforce. That is because these contractors are not treated as employees (in a financial and legal sense), and have domain expertise very closely matched to the specific project requirements they’re hired for. Though financial savings top any list of reasons to opt for licensed independent contractors, it makes sense for businesses to understand the broader picture so that they can explore the benefits of licensed contractors in business situations that merit their employment.

Financially viable alternatives to hiring permanent employees

In many cases, hiring licensed independent contractors is a decision made on financial grounds. Even though licensed contractors tend to charge more per hour rates than permanent employees, the cost of availing their services proves to be less than that incurred if you choose to recruit more people. When you hire an employee, you have to bear the cost of providing office space, equipment, along with joining time benefits and incentives. Also, you will be legally required to contribute to social security (and medical care, in some countries) fund of the employee. Other expenses include payments made towards state unemployment compensation insurance, worker’s compensation insurance, medical insurance of employees as part of company policy, etc. The cost of employing a person can exceed the yearly salary you pay to him by almost 25%. All these expenses are avoided when you employ a licensed independent contractor.

Hassle free and quick adaption to work requirements

Independent contractors, when compared to permanent employees having the same duration of experience, can boast of the much greater knowledge base and experience. That’s because these people have the experience of having worked in a variety of projects, and are hence equipped with the domain expertise and business foresight to quickly make an impact when asked to join on a project. Since these people are only called to work on projects with tricky requirements and little freely available information about best practices, they’re well versed with the technical acumen as well as the business acumen of helping firms execute important projects in a better manner. The volume of execution challenges faced and mastered by licensed independent contractors is easily more than twice of what the routine employee faces. This makes them the perfect resources to have when the heat is on! Contractors lose little time in warming up to the peak performance levels and begin contributing from day 1. Of course, there are no on-boarding or training requirements for these people, which further reduces unnecessary delays.

Separating from independent contractors is easier to manage

Working with a licensed contractor is undoubtedly simpler and more hassle-free than a routine employee because there are no unsavory situations when these people have to be ramped off the projects once their roles are no more needed. Commonly, in projects (such as construction, household electricity, and water supply setup, IT implementations) with fluctuating workloads, contractors are the ideal people to have, as they work with the complete understanding that once their job is done, they’ll have to move on to the next project. No emotional outbreaks, no legal troubles associated with firing and layoffs, no lengthy settlement processes – licensed contractors can seamlessly transition off the project.

No employee care liabilities to legally take care of

The laws of employment in Australia accommodate several legal rights that employees can’t be denied by any employer. Although most of these rights are needed to ensure worthwhile employment for people, companies can turn out to be on the losing side in really short term projects if the loopholes of these laws are exploited by employees. For instance, a permanent employee will be fully entitled to avail his/her yearly allocation of leaves anytime. Of course, a company will not be able to afford an expensive contractor employed on a 1-month project, if he takes 5-7 days off from it! Because of this, contractors are considered as independent businessmen and are hence kept out of the scope of laws governing long term employment when people are registered on the payrolls of employing companies. Here are some rights that an employee is entitled to, but not an independent contractor-

  • The right to participate in activities directed at developing and forming a union in the company

  • The right to claim overtime compensation at a rate more than the normal hourly wage rate

  • The right to be served an adequate notice period before the termination of services.


This can suit the interests of a business, especially in short duration projects. Of course, licensed contractors are governed by laws pertaining to wrongful termination, etc. Eventually, both the business and the contractor are fully aware of the nature of their business association, which helps maximize results from the short term contracts under which they work together.

With an understanding of how independent contractors can bring in domain expertise and result in centric approach for projects with short term scope, niche appeal, and fluctuating workload, it’s also necessary to realize that identifying really qualified, professional, and licensed contractors can be a challenge. If you are in need of professional and licensed independent contractors in any part of Australia, trust www.licensedtrades.com.au as your one-stop shop to connect you with contractors of repute and experience. Right from builders seeking plumbing and electricity experts to IT businesses hunting for niche experts, once can search licensed people near your area.

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