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Freelancer vs. Full-Time Employee: Deciding Which is Best for Your Organization


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Updated on:
February 28, 2024
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Updated on :

February 28, 2024
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Freelancer vs. Full-Time Employee: Deciding Which is Best for Your Organization

These days, many employers and organizations weigh the benefits and drawbacks of either employing a freelancer or a full-time employee. This article will highlight the differences between working as a freelancer and a full-time employee and the advantages and disadvantages of both options. Also, we will delve into factors to consider before choosing either a freelancer or full-time employee.

Advantages and disadvantages of Freelancing

Freelancers are typically in charge of their business and have a high level of autonomy and control over their work process and the kind of clients they engage. However, there are some drawbacks to hiring a freelancer. Here are a few pros and cons of freelancing.

Advantages of freelancing

  1. Flexibility: Unlike full-time employees, freelancers enjoy flexibility with work that leads to an improved work-life balance. Freelancers set their own working hours, decide on the type of clients to work for and the projects that pique their interest.
  2. Potential for higher income: With no restrictions to the number of clients they can work with, freelancers are better positioned to earn more than their full-time employees' counterparts. 
  3. Diverse work experience: Because freelancers work on various and diverse projects, they have a more varied work experience, making them better suited to adapt to any role they choose.
  4. Control over workload: Freelancers have control over their workload. They can decide to take on more or fewer projects at a time. This autonomy can be particularly appealing to those who thrive in a self-directed environment.

Disadvantages of freelancing

  1. Absence of job security: Full-time employees enjoy job security unavailable for freelancers. Projects may be infrequent, clients may change, and freelancers may be unpaid for extended periods of time, resulting in financial insecurity.
  2. Irregular income flow: Income from freelancing is inconsistent and unpredictable. As a result, planning and budgeting become challenging.
  3. No benefit packages: Full-time employees generally receive comprehensive packages from their employers, unlike freelancers, who are usually responsible for their own benefits, such as health insurance, retirement plans, and paid time off.

Read more on the differences between freelancing and a sole proprietorship here.

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Advantages and disadvantages of being a full-time employee

Employers must provide comprehensive benefits packages for their employees. This is just one of the perks of being a full-time employee. Here are some of the advantages and disadvantages of being a full-time employee.

Advantages of Full-time employees

  1. Job stability: Full-time employees generally enjoy greater job stability than freelancers. Organizations invest in training and onboarding new employees, making them less likely to let go of full-time staff than short-term contractors. This stability can provide peace of mind and a more predictable income.
  2. Regular salary payment: Full-time employees get paid either monthly or per hour, which makes budgeting and planning for the future simpler.
  3. Employee benefits and perks: Many organizations provide comprehensive benefits packages to their full-time employees, which may include health insurance, retirement plans, paid time off, and other rewards, including professional development opportunities and compensation.
  4. Structured career progression: Full-time employment typically includes a more structured career path and opportunities for advancement within the company.

Disadvantages of Full-time employment

  1. Limited flexibility: Typically, full-time employees have less influence over their schedule and responsibilities than freelancers. This can be difficult for those who value work-life balance or have other outside obligations.
  2. Less control over projects: Full-time employees may have less control over the projects they work on and may be required to work on projects that do not correlate with their interests or skill sets.

The decision to hire either a freelancer or a full-time employee depends on the nature of the task at hand, its recurrence, and the organization’s goals. By carefully evaluating the pros and cons of each employment type, you can make an informed decision about your organization’s hiring direction. 

While hiring either a freelancer or a full-time employee can be challenging for any globally distributed organization, partnering with a global employment and payroll platform like Skuad can make your hiring process easier.

Hire freelancers or full-time employees with Skuad

Skuad is a global employment and payroll platform that enables organizations to hire full-time employees and freelancers in over 160 countries without setting up subsidiaries or legal entities. Skuad’s platform also helps organizations onboard talent, manage payroll, and ensure compliance with country-specific employment laws and tax regulations. 

To know more about Skuad, book a demo today.


Are taxes higher for freelancers?

Freelancer taxes can be higher or lower depending on the freelancer's income. However, freelancers may be required to make tax payments on a quarterly basis to avoid being fined.

Do freelancers get days off?

Yes, because freelancers are responsible for fixing their work schedules. However, there is usually no paid allowance for their time offs, and they may lose paid jobs during their off days.

Is it better to say self-employed or freelance?

While both can be used interchangeably, "freelance" is mainly associated with activities in the tech and creative industry like writing, software development and design. On the other hand, "self-employed" is a broader term that covers both freelance and other sole business activities.

How many hours a week do freelancers work?

There are no stipulated work hours for freelancers as it is primarily based on the freelancer's discretion. Freelancers fix their work schedule and, therefore, may have irregular work hours.

About the author

Sandeep Patel is a Content Marketing Manager and Strategist. Over the last five years, he has created and managed content for global brands and fintech startups. He is passionate about remote work and using tech for a better work-life balance.

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