Skip to main content

Benefits of contracting vs permanent employment

Kerry Hull

Kerry Hull | Marketing Manager

Monday 5th Oct, 2020

There are many reasons why over a million people have chosen a career in contracting. However to find out what the top reasons are, who better to ask then our contractors.

Increased Flexibility

Flexibility is playing a bigger role in our career choices now more than ever before. It’s also common knowledge that having the right work life balance plays an important role in achieving better health and happiness. With contracting you have more choice on where, when and how you work. Whether you want to work around your children, your hobbies or your golden retriever Bruno. You have the ability to choose a contract that best suits your needs at that time. And if your circumstances change, you can factor that in to the next assignment that you choose.

Variety

The ability to work on more than one contract at the same time means that you can switch between different types of work during your working day or week, keeping your work interesting and varied. They do say that variety is the spice of life and it’s proven that a varied working day can even lead to increased productivity and motivation.

Higher Income

Traditionally contractors earn more than a permanent employee in a similar role. Not only that, where possible you can claim tax relief on allowable business expenses as they are incurred, making it a more tax efficient way to work.

Choose your own development path

As a contractor you have the opportunity to choose what training you undertake, how you take part in it and how often. Of course, it’s in your best interest to choose your training wisely as you want it to add value to your proposition. Your aim should be to become a specialist in your chosen area as this not only allows you to put yourself forward for more contracts, but it also makes you a more desirable candidate giving you the potential to request a higher pay rate.

Well-rounded experience

Working in multiple businesses, across various industries who all use different processes and systems enhances your overall experience, again making you a more desirable candidate. It’s this well-rounded experience that brings added value to each role you take.

Not relying on just one company

The beauty of contracting is that your future isn’t tied to any one company. This can be particularly beneficial during uncertain times such as a recession. As a contractor you may be free to take up more than one contract at any given time, meaning that you no longer have to rely on one employer as you would in a permanent position.

Take as little or as much time off as you like

How does being able to take as much time off as you like sound? When you are in between contracts how much time off you take, is up to you. Meaning you can plan that extended holiday or those exotic travel plans around the contracts you accept.

No more office politics

Another perk of being a contractor is that you will no longer have to get involved with, or spend your time trying to avoid, all of the office politics which can sometimes be detrimental to productivity. As your position is only temporary it means that before you get too embroiled in any office politics you’ve probably already moved on!

All the perks of contracting with all the benefits of permanent employment

If you choose to work through an umbrella company you not only get to enjoy all of the perks of contracting as mentioned above, but you also get to enjoy some of the benefits of permanent employment.

A contract of employment

As you are employed under a contract of employment you are still entitled to statutory benefits such as statutory sick pay and statutory maternity or paternity pay. Using the same umbrella company for each assignment means that you also build up a record of continuous employment, which can help with mortgage and loan applications. Not to mention the fact that you’ll only pay into the one workplace pension pot.

Salary Sacrifice scheme for pension contributions

Some Umbrella companies, like My Max, will offer salary sacrifice schemes which allows contractors to contribute into their own pensions via a salary sacrifice arrangement. This can save you £100s in PAYE and NI contributions each month.

 

An extra bonus – Free employee rewards

One perk that isn’t available to permanent employees is access to an employee rewards scheme. As a PayStream umbrella contractor, you have access to a phenomenal range of discounts, offers and cashback at thousands of retailers and the best part is with My Max it’s free of charge! Not only do umbrella contractors have access to all of this but they also have access to monthly competitions including a free to enter lotto in which they can win £100’s each month in prizes.

So whether you are still looking to make the move from permanent into contract work or you’ve already made the decision and you’re wondering what next, PayStream is here to help.

Get your quote

Related article - How to find and win that next contract

Finding and winning contract work is a whole different story to finding and winning a permanent job. Contractors often get just one opportunity to impress as they are usually hired after just one interview. And competition for those great contracts can be fierce, especially in the current climate. So it’s crucial that you’re doing everything you can to not only find but also secure that next role, here are our hints and tips in doing just that.

How to find and win that next contract
Back to the Top