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Contractor versus consulting – what’s best for you; What’s best for the client?

When a senior person ‘gets’ a break or wants a break from their full-time gig, the common response to ‘what are you doing now?’ is usually, ‘I’m going to be a consultant for a while’. But what does that mean for the clients? How is that different to contracting? And, what is the best path for organisations looking for more support?

Consulting and contracting are often used interchangeably, but I feel they are two very different paths to take; and which path you chose can impact expectations all round.

With the changes to the laws regarding who is responsible for the payment of superannuation, things get trickier.

To me, a contractor is someone who has a regular gig for a company, potentially even full-time. You’ll have set KPIs, and regular WIP meetings with the team, have a company email and even a phone allowance. Contracting is providing skills or a service that a company can’t afford to have in-house full time; this is perfect for sales, marketing, strategic projects and business development to name a few. You are basically a staff member who invoices.

A consultant is someone that is commissioned to provide expert skills and knowledge around a defined set of deliverables over a short-term project. They come in, do their thing and then leave. The same professions suit as contract work, but a consultant brings high-level thinking, often working with the senior management and invoices without super.

Many of us would love to have a balance of both – one or two contracts (to pay the mortgage) and some consulting work that goes up and down (for the holidays).

However, when choosing to employ a contractor or a consultant, what should a company be thinking about?

Here is my checklist for businesses, and organisations needing some more hands-on support.

  1. What is the purpose of the role? Is it to take longer-term responsibility for the project, or provide an uplift of skill, resource or injection of senior skills such as strategy?

  2. Is there a natural end to the project?

  3. Does this arrangement have assessment milestones built in?

  4. Is it clear what success looks like?

  5. Does the person you have in mind have lots of other commitments? Will they have contractors themselves doing the work?

  6. Will this person be representing your organisation to your stakeholders?

  7. Does the work identified need to be supported by an internal person (such as in a rebrand) or can it be done independently?

  8. What is the risk to the organisation for exposing an external person to its machinations?

  9. Does your contract comply with the recent rules around contractors?

Ensuring all your people are working for the benefit of your organisation is key. What is your experience? I’d love to hear about it. Please drop me a line at

PS: Check out ATO’s Decision Tool here


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