We treat our employees like family, if we care about them. That's not saying much if the corporate leadership does not care well for their family, but that's another story. Often, however, treat our contractors like indentured servants - or at least hired servants - and thus evaluate their work by a different standard. This can cost more in the long run... we need to be careful to understand our own mindset!
If you have an employee that spends 12 hours banging their head against the keyboard trying to solve a complex problem that - in the end - results in a simple quick fix that gets your system back up, often you will praise them for the dedication on the project. If you have a contractor that does the same, you will question your rates, their knowledge, and their dedication to the project - and most likely you will only want to pay for the 20 minutes of work it took to fix the problem, since they never should have caused the problem anyway. You may be OK with a few hours, but 12?!? So begins the difference in the way we value one's effort based on some outside measure of worth (in or out of the team). Granted, there is a reason and a merit in scrutinizing the work of a contractor, but there should be for an employee as well.
There is a very important point here: our contractor and vendor relationships are often as critical as our employee and customer relationships, yet they are most often the ones that we will have troubles with when it comes to contentious areas like billing and work quality. This article is designed to help establish a baseline to resolve these problems in a healthy way, assuming that they will come up naturally.
Step 1: Why Contract at All?
Check out this quote from an Olde English book on contracts: "How now, then good people, if we are to have a bold and encouraged future designed by quality people, should not we respect their efforts wherefore they doth produce according to thine own Ten and Ninety Nine or thine own Double-U Two?" OK, I made that up.
Tax forms can sound like some odd foreign language, to be certain, but the sentiment above is quite simple - the primary differences between contractors and employees is one of taxation, not mere honor or importance of product. We must be clear that there are many very good reasons to use contractors, some of which we shall discuss below, but hardly any of them should include "so that I can question their honesty" or "so that I can pay more than I would for the bums that work for me." Step one in determining our mindset for contractors versus employees is to ensure that we know why one is chosen over the other - period.
If you are using or considering use of a contractor, one of the following is most likely to apply:
- The work is short term in nature (no assurance of future need);
- The work is highly specialized AND is either sporadic or not required for your long-term needs;
- The requirement is immediate (or there is a burst requiring augmentation of other staff) and a contractor is the best short-term solution;
- There are contracting sources that can scale better than you can for the given expertise (hiring an in-house mechanic versus contracting with one for your two vehicles, for example);
Quiz: which one of the following gives you more reason to question the honesty of your contractor above an employee? None of them. Selecting a contractor may be an art form and yes there certainly are dishonest ones out there (in every kind of business), but the reason we hire a contractor is not to question their integrity - so then how do we properly do so?
Step 2: Establishing a Proper Channel
I prefer very simple contracts. This goes for individual and corporate contracts. There is of course always the need for legal-eze to some degree; but the purpose of such language is to protect and clearly define rather than to hide and mystify - such actions will always come back to bite you.
Step 3: Feedback - the Art of Managing Expectations
When an employee messes up, we must take a certain degree of grace to train them. We all know (hopefully) that mistakes are a valuable part of learning. Do you have such tolerance with contractors? Of course not, they were suppose to know already, that's why they are contractors.
Step 4: Examining Billing - Getting What You Paid For
The very top of the article uses the example of the 12 hour bug fix on a software problem. Are you getting your money's worth on contract labor? One serious advantage contractors have over employees is rate justification, another is flexibility, but the huge swing to the employee's favor is security in hours worked (most of the time).
Conclusion
This is a long post, so I'll wrap it up for now. There is certainly much more to be said on this topic. To be fair, I have been on both sides of the fence, manager of contractors and contractor in the mix, so it is easier to see clearly. If you have not had the benefit of working in both environments (especially at the same time) it is well worth taking some time to think it through deeply - you may save more than a little money in the process.