Using contractors and subcontractors
Pros and cons of using a contractor or subcontractor to provide
staff
Many businesses needing extra staff use contractors and subcontractors
successfully, but sometimes there can be problems or complications.
Consider the following:
| Advantages |
Disadvantages |
| You can hire a contractor/ subcontractor when
you need more flexibity |
Contractors/subcontractors may cost
the business more than the employee equivalent day rate |
| You can use a contractor/ subcontractor for one-off
jobs and jobs requiring specialist expertise
or fast turnaround |
Your business does not acquire or
develop skills in-house and relies on suppliers |
| Your permanent staff can concentrate on the core business |
Permanent staff may resent contractors being paid
more money for doing similar work to them |
| Some contractors/ subcontractors can start the work or project
at short notice, even when large numbers of
workers are required |
You have no direct control over the quality
of subcontractors' work |
| You can often specify the type and duration of contract you
need for the job |
Contractors/subcontractors may not appreciate
your business culture and may lack the motivation
and commitment of permanent staff |
| You can obtain temporary cover for a permanent
staff job or work that needs doing |
You have legal responsibilities for the health
and safety of such persons on your site |
| You have no PAYE or National Insurance contributions
(NIC) administration for contractors/subcontractors |
Workers can be employees or subcontractors of
the contractor - you need to understand relevant tax implications
and other rights. For more information see the page in this
guide on employment status - implications for tax and
worker rights |
You can read
about flexible contracts and subcontractors at the Acas website.
Subjects covered in this guide
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