Consultant vs Contractor vs Employee

jillbartlett

Hello,

We are discussing the differences between a consultant, contractor and employee...Do any of you have a good summary to share to help us better understand/explain the difference?

Thanks!

HRforME

The State of Texas has an employer handbook that is really good...It discusses this issue from a national perspective rather than a specific state perspective at: http://www.twc.state.tx.us/news/efte/ics_contract_labor.html

However it doesn't distinguish between an IC and a consultant.

 

empowermentHR

We can always count on Uncle Same to provide us some handy info for our use.  This one highlights the employee vs IC but again does not break out "consultant"

 

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

TXHRGuy

The word "consultant" is largely meaningless in the debate about employee vs. contractor.  I know of at least one large company that officially uses the word "consultant" to describe any person doing exempt level "managerial" work but has no staff.  I also know consultants who work on a business to business relationship with companies and is, quite clearly, a contractor.  In the end, you are either issuing a w-2 or a 1099 and a consultant could receive either.

I was, at one time, working as a freelance HR consultant.  I offered people 3 options.  1) pay a large fee up front (to cover all my insurance costs), 2) hire me through a staffing agency (high per hour cost but offsets my liability), 3) hire me on a temporary basis (lowest cost for them, lowest liability for me).  I have done many gigs as a consultant as a temporary employee directly hired by the company, filling out all their paperwork, etc.