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Lots of people contract to a former employer. That's what I'm doing at the moment.


How does that work out?

I mean, it seems like if someone went to their employer and said, "I'm going to stop working for you, but if you pay me more than you are now, I will sell you software," they would say, "No thanks."


Businesses are rational. If they need what you're selling, and buying it from you is more cost-effective (inclusive of risk) than building up an internal process to deliver it themselves, they'll buy it.

This apart from the fact that transforming an employee to a contractor is often a net financial win for a company. Not just because of benefits, but also because when the contractor finishes, you don't have to find a way to fire them.


Right.

Another thing that contractors are good for is mopping up the unspent money allocated to various line items. Most places with a union/enterprise bargain contract don't allow the employer to a project without a full time equivalent wage attached somewhere in the budget. So when there's a few thousand left, it might be difficult to spend.

Enter, stage right, the contractor, to whom no such rules apply.


I quit my job for family reasons; they asked me to stay on as contractor. It's a surprisingly common pattern, I'm told.

I am developing a niche tool for business at the moment. To get my initial customers I expect I will go visit them in their offices, ask questions and show them the prototype. Old fashioned, but I've picked an area where improving performance by a few percent can mean millions of dollars difference in outcomes.


if someone went to their employer and said, "I'm going to stop working for you, but if you pay me more than you are now, I will sell you software," they would say, "No thanks."

Instead what happens is:

someone went to their employer and said, "I'm going to stop working for you, sorry, but I'm quitting to set up my own buisiness. I know about the business, I know about the technology. I know you and know what you're like to work for. You know me, and know what I'm like to work with. You know that I will know what you mean when you say 'The featured image for this works for a promoter, but not a sales client'. You don't have to take the time & effort to find someone new who might not work out, We can have a productive and mutually benefitial business relationship."

The paycheck might be higher, but the company doesn't have to pay hidden costs like tax, pension, schedule maternity/paternity leave, sick days or pay holidays.


You're assuming that because the contractor has a higher paycheck that it's more expensive. This isn't necessarily true.


i have a friend who was laid off, but then a year later they hired him back as a contractor at a much higher rate.




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