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It’s interesting how even within companies a hard set social hierarchy has taken place between employees and contractors. The contractors tend to perform the ex

It’s interesting how even within companies a hard set social hierarchy has taken place between employees and contractors. The contractors tend to perform the exact same duties as employees, but are usually paid less, have worse future prospects (companies tend to like to hire from full time to full time), worse benefits and generally don’t get most of the perks of being an employee. For coders, is this because they’re objectively somehow worse programmers? Given all the emphasis in hiring on avoiding “bad” hires at all costs, it seems like there’s a conflict between paying for people who are “worse” than a FTE but still accepting their contributions. I realize it’s a strategy that gives the companies more leeway to expand and retract their workforce, but then stigma that is attached throughout the industry around contract workers shouldn’t exist, right?

netheril96 9y ago
Do companies whose primary employees are programmers also employ contractual programmers? According to my observation, computer technology companies may have contractual workers, but only for other roles.
- simcop2387 9y ago
  Most companies that I've worked for have had them, usually for specific purposes (billing system related) but they've also had them as more general cases, for less than full time work usually (the people also contracted out to multiple companies). I don't know how common this is though since it's only a few companies and the people involved are all semi-related (Perl programming community).
- ereyes01 9y ago
  From personal experience (and admittedly stale by some 8 years), IBM had lots of contractors doing software development alongside full-timers. It was a pretty insecure position to be in because they would take the brunt of layoffs, and many I knew were gone by the time I left, with a couple of exceptions. Many were ex-employess who had been previously let go or were retired. Some were not, and all were basically indistinguishable from regular developers... they just happened to fill a req that merely funded a contractor instead of a full-time employee, depending on how the money was handed out to departments.
- Zak 9y ago
  Yes, absolutely. I've had several clients like that. Usually, the work centers around something that isn't their core business or a technology that their full-time programmers aren't very experienced with. Sometimes it's just a matter of fluctuating workload where hiring another person full-time wouldn't make sense.
- Bahamut 9y ago
  Even companies like Google employ contractor programmers.
- meddlepal 9y ago
  Yes, all the time. Often in key positions or on strategic initiatives where expertise or specialist skills are needed. I've also seen short contracts used while a company ramps up hiring FTE as a velocity optimization to get the ball rolling on something new.
- perl4ever 9y ago
  I couldn't tell you the reasoning, but I've worked at a couple of places where there were contract programmers alongside FTE programmers. In one case, that contract programmer became a FTE, but in either situation, most of the programmers were FTEs.
- dragonwriter 9y ago
  > Do companies whose primary employees are programmers also employ contractual programmers? Yes, e.g., firms whose main line of business is contracting out employees who are programmers hire programmers as subcontractors in addition to regular employees to round out special skills needed in contracts.
jMyles 9y ago
I'm not sure this is a very good read, especially in the startup scene. I have been in a position (for which I'm super grateful) in which young startups didn't have the funds to pay me my full-time rate, and so instead chose to pay me a weekly rate to work one week out of the month. I like to believe that I provided substantial value in that configuration - usually landing to review code, mentor newer programmers, and help chart direction for the subsequent three weeks (during which I'd be absent). In this case, I was being paid quite a bit more than the full-timers, not less. In time, they grew to be able to afford a more complete full-time cadre, and they people I worked with weren't so junior anymore. I did this... I think half a dozen times. It was a great work config for everybody. If you can afford to travel to the work and you can really bring the fight for 5-8 straight days, I highly suggest it.
- ddingus 9y ago
  Honestly, yours is a GREAT read. That's a very solid case for contractors and almost nobody will have a meaningful problem with it. I've done similar things in the CAD / data management space. A person with outside perspective, rare skills, experience, and most importantly, is the outside voice able to bring real options to the table along with production proven, time tested ways and means, is worth every penny. The full time peeps should be taking you out for a lunch or two to network and gain some easy, high value mentoring, contacts... I would in a second, and have had others invite me for this kind of thing. Some have remained in touch for years, and as they grew, have helped me as I did them. If we had more of that going on, it would benefit nearly everyone. But we don't. The majority case boils down to head count quotas, and cost of labor factors. Often, these are both under specified, leaving managers to find contractors to fill gaps. The larger companies do this and it's chronic.
  - ajross 9y ago
    > A person with outside perspective, rare skills, experience, and most importantly, is the outside voice able to bring real options to the table along with production proven, time tested ways and means, is worth every penny. Such a contractor would likely meet the new "ABC" standard in the linked article, though. Those aren't the positions that are in danger of being eliminated, it's the "grunt contractor" folks who are contractors only because the employer wants to keep a buffer of positions that are active but can be terminated easily.
Trundle 9y ago
I think this can vary a lot. Contractors often charge very high rates, but then they're called a consultant even if theyre there to do/create rather than consult.
- noobermin 9y ago
  That would seem NOT to be to whom this ABC criteria applies, specifically on the "independently established role." This seems to most address those who have less power in the employer-contractor relationship.
volkfish55 9y ago
Contractor are paid more, since they have to factor in the health insurance, taxes, unpaid vacation, perks, their own laptops, no need for office space, no 401k match. There is no reason they would ever get paid less. Maybe those with H1B visas who can get taken advantage of or outsourced contractors in Ukraine? Those contractors definitely get paid a fraction of US salary.
- CydeWeys 9y ago
  The vast majority of "contractors" in the US are paid than their full-time equivalents.
  - kbenson 9y ago
    > The vast majority of "contractors" in the US are paid than their full-time equivalents. You're missing the most important word there. I'm honestly not sure which one is intended.
    - CydeWeys 9y ago
      Meant to say "less" :/
- taurath 9y ago
  Contractors are almost always paid less in my experience after taking into effect stock grants and bonuses. The contracting agency probably gets a nice portion of the takehome though (for having the political capital of being on a preferred vendors list), so to the company they probably pay more than salary.
  - fortythirteen 9y ago
    You also have to factor in the amount of responsibility for pay. A contractor with decent negotiation skils may net out slightly less than a FT senior dev at a company, but they often have less responsibility than even the FT junior and mid-level devs. Not to mention that they never get dragged into internal company politics or loyalty games. Factor in overtime, or the lack thereof, and you can make more or have far more work/life balance than FTs. That weekend app release? There's an extra $500-$1k that the FTs aren't getting. Company doesn't allow contractors to work over 40 hours for budgeting purposes? Leave at 5 everyday without anyone complaining.
BurningFrog 9y ago
There are two distinct classes of contractors. - Those who aren't good enough to get a full time job. - Those who are too good to settle for a full time job. The two groups are treated quite differently.
- kelukelugames 9y ago
  Hahaha, I saw someone in the hallway wearing a contractor badge and a MIT hoodies. I am an alum so I asked about their time there. They said they graduated in 2003 but started in 91. I said, "Woah that's one helluva of a PHD." Turns out, they took a 10 year gap to play blackjack. Now they just work for fun every couple of years because they otherwise get bored. https://en.wikipedia.org/wiki/MIT_Blackjack_Team https://en.wikipedia.org/wiki/MIT_Blackjack_Team
- taneq 9y ago
  Sounds like "casuals" vs. "contractors". Casual staff are often on very similar terms to contractors, apart from the rates of pay, but are seen as interchangeable rent-a-crowd rather than outside expertise.
  - dghughes 9y ago
    There were casual workers at the last place I worked some had been there 20 year or more. One day (literally on one day) they were all told they were not needed, no severance, no thanks just let go. Disposable human workers.
- octorian 9y ago
  I've run into both types. The former are typically a group of second-class employees companies use as a way to "trial" someone before hiring them for real, or simply to skirt the requirements of employing someone full-time. They also tend to work for some shell company you've never heard of, at least on paper. The latter tend to be older folks, and often experts in various fields. They also have little trouble finding another "gig" almost immediately after their current one dries up. These people are usually self-employed.
WalterBright 9y ago
Back when I worked at Boeing, contractors got paid about double what the full time employees did. But, they received no employee benefits (worth about 40% of the employees' salary, if I recall correctly) and could be let go at a moment's notice. So in the end it worked out about the same. If the law requires contractors to get the same benefits, etc., the result will be the contractors will get paid less. The ones I knew wanted the higher pay / no benefits circumstance, and they'd lose that option.
deleted 9y ago
[deleted]
forapurpose 9y ago
> The contractors tend to perform the exact same duties as employees, but are usually paid less, have worse future prospects ... There was a very interesting NY Times article last fall about that issue. They contrasted janitors at Apple, who work for a contractor and have no prospects for advancement in Apple, and Xerox's janitors in the 1980s who were employees, and one of whom is now Xerox's CTO: https://www.nytimes.com/2017/09/03/upshot/to-understand-rising-inequality-consider-the-janitors-at-two-top-companies-then-and-now.html https://www.nytimes.com/2017/09/03/upshot/to-understand-risi... To veer off on a tangent, I suspect it's connected with a new elitism in the U.S. What used to be the celebrated 'Land of Opportunity' where anyone could live the "American Dream' through hard work, regardless of where they started (even if very poor immigrants), is now a place where the children of the wealthy go to college, those of the working class are encouraged to go to trade school, and immigrants are more commonly discouraged.
- Camillo 9y ago
  You are so wrong I don't know where to start. The percentage of Americans with college degrees has never been higher. For decades, the message from authorities has consistently been to encourage youths to go to college as much as possible, and the number of students has kept increasing beyond all reason. We are well past the point of diminishing returns, and into pure and simple harm, where millions of Americans go into debt to get pointless degree just so they'll be considered for jobs that shouldn't need a degree in the first place. It's a disaster.
  - forapurpose 9y ago
    Those claims are trendy, but the parent provides no basis for them and I've never seen one. There's plenty of reason to believe otherwise: The 'youths' want to go to college, and in a free country and a free market, it's believed that they know and decide their own best interests. Businesses in fact highly value college education; they pay people with college degrees much more than people without them. The incomes of people without degrees has been stagnant for decades, and there's concern among economists that their job prospects will become more difficult due to automation. If it had reached a point of diminishing returns (really, small marginal benefit), then the wage differential would be small. As I pointed out above, it's really economic discrimination: Education depends, more than anything, on family wealth. So the outcome of what the parent advocates is that the wealthy classes go to college and the lower classes don't get that opportunity. Usually it's wealthy people with college degrees that say college isn't needed; but tell them that their kids shouldn't go to college and you'll get a much different response. > The percentage of Americans with college degrees has never been higher. That's great. We want people to be better educated, more productive, and live better lives. That's the 'American Dream'. We don't want the economy stuck in the 1980s, but to move forward. It also makes the economy more productive. For example, Silicon Valley can't get enough talented developers, yet the United States (and world) is filled with kids with no access to education, many of whom probably could fill that talent gap. We need more education. High skill, high-paying jobs will go where there are more highly educated workers; if the U.S. cuts college education, it will go elsewhere. New businesses and industries that we haven't yet imagined will arise when they have that resource of educated people. Education also makes people healthier, better citizens, better parents, etc. HN celebrates knowledge; it's hard to suddenly discount it in this case. > It's a disaster. By what measure? The only disaster is that education is too expensive and not available to people without money.
lazzlazzlazz 9y ago
In my experience, contractors are almost without exception worse than full-time employees in terms of the quality of their work. The contractors who stand out get selected for full-time work relatively quickly and consistently.
- jMyles 9y ago
  > The contractors who stand out get selected for full-time work relatively quickly and consistently. ...but many of us pass on full-time offers nearly constantly. It's not like contractors are just waiting for the day when they are "selected."
- richardknop 9y ago
  Most contractors I know get full time offers constantly and they keep turning them down :)
dingo_bat 9y ago
In my limited experience contractors are paid much more.
afpx 9y ago
Given all the emphasis in hiring on avoiding “bad” hires at all costs ... I suspect that a small portion of companies use grueling interviews as more of a hazing ritual, and many of the rest follow because, well, that’s just what everyone else seems to do.
e40 9y ago
worse benefits Make that no benefits. In my 35 years in the tech industry I've never seen a contractor that got benefits, since it's the primary reason contractors exist.
walshemj 9y ago
er not in my experience are you confusing w2 contractors hired from a job shop with real self employed ones.

netheril96 9y ago

Do companies whose primary employees are programmers also employ contractual programmers? According to my observation, computer technology companies may have contractual workers, but only for other roles.

simcop2387 9y ago
Most companies that I've worked for have had them, usually for specific purposes (billing system related) but they've also had them as more general cases, for less than full time work usually (the people also contracted out to multiple companies). I don't know how common this is though since it's only a few companies and the people involved are all semi-related (Perl programming community).
ereyes01 9y ago
From personal experience (and admittedly stale by some 8 years), IBM had lots of contractors doing software development alongside full-timers. It was a pretty insecure position to be in because they would take the brunt of layoffs, and many I knew were gone by the time I left, with a couple of exceptions. Many were ex-employess who had been previously let go or were retired. Some were not, and all were basically indistinguishable from regular developers... they just happened to fill a req that merely funded a contractor instead of a full-time employee, depending on how the money was handed out to departments.
Zak 9y ago
Yes, absolutely. I've had several clients like that. Usually, the work centers around something that isn't their core business or a technology that their full-time programmers aren't very experienced with. Sometimes it's just a matter of fluctuating workload where hiring another person full-time wouldn't make sense.
Bahamut 9y ago
Even companies like Google employ contractor programmers.
meddlepal 9y ago
Yes, all the time. Often in key positions or on strategic initiatives where expertise or specialist skills are needed. I've also seen short contracts used while a company ramps up hiring FTE as a velocity optimization to get the ball rolling on something new.
perl4ever 9y ago
I couldn't tell you the reasoning, but I've worked at a couple of places where there were contract programmers alongside FTE programmers. In one case, that contract programmer became a FTE, but in either situation, most of the programmers were FTEs.
dragonwriter 9y ago
> Do companies whose primary employees are programmers also employ contractual programmers? Yes, e.g., firms whose main line of business is contracting out employees who are programmers hire programmers as subcontractors in addition to regular employees to round out special skills needed in contracts.

jMyles 9y ago

I'm not sure this is a very good read, especially in the startup scene. I have been in a position (for which I'm super grateful) in which young startups didn't have the funds to pay me my full-time rate, and so instead chose to pay me a weekly rate to work one week out of the month. I like to believe that I provided substantial value in that configuration - usually landing to review code, mentor newer programmers, and help chart direction for the subsequent three weeks (during which I'd be absent). In this case, I was being paid quite a bit more than the full-timers, not less. In time, they grew to be able to afford a more complete full-time cadre, and they people I worked with weren't so junior anymore. I did this... I think half a dozen times. It was a great work config for everybody. If you can afford to travel to the work and you can really bring the fight for 5-8 straight days, I highly suggest it.

ddingus 9y ago
Honestly, yours is a GREAT read. That's a very solid case for contractors and almost nobody will have a meaningful problem with it. I've done similar things in the CAD / data management space. A person with outside perspective, rare skills, experience, and most importantly, is the outside voice able to bring real options to the table along with production proven, time tested ways and means, is worth every penny. The full time peeps should be taking you out for a lunch or two to network and gain some easy, high value mentoring, contacts... I would in a second, and have had others invite me for this kind of thing. Some have remained in touch for years, and as they grew, have helped me as I did them. If we had more of that going on, it would benefit nearly everyone. But we don't. The majority case boils down to head count quotas, and cost of labor factors. Often, these are both under specified, leaving managers to find contractors to fill gaps. The larger companies do this and it's chronic.
- ajross 9y ago
  > A person with outside perspective, rare skills, experience, and most importantly, is the outside voice able to bring real options to the table along with production proven, time tested ways and means, is worth every penny. Such a contractor would likely meet the new "ABC" standard in the linked article, though. Those aren't the positions that are in danger of being eliminated, it's the "grunt contractor" folks who are contractors only because the employer wants to keep a buffer of positions that are active but can be terminated easily.

Trundle 9y ago

I think this can vary a lot. Contractors often charge very high rates, but then they're called a consultant even if theyre there to do/create rather than consult.

noobermin 9y ago
That would seem NOT to be to whom this ABC criteria applies, specifically on the "independently established role." This seems to most address those who have less power in the employer-contractor relationship.

volkfish55 9y ago

Contractor are paid more, since they have to factor in the health insurance, taxes, unpaid vacation, perks, their own laptops, no need for office space, no 401k match. There is no reason they would ever get paid less. Maybe those with H1B visas who can get taken advantage of or outsourced contractors in Ukraine? Those contractors definitely get paid a fraction of US salary.

CydeWeys 9y ago
The vast majority of "contractors" in the US are paid than their full-time equivalents.
- kbenson 9y ago
  > The vast majority of "contractors" in the US are paid than their full-time equivalents. You're missing the most important word there. I'm honestly not sure which one is intended.
  - CydeWeys 9y ago
    Meant to say "less" :/
taurath 9y ago
Contractors are almost always paid less in my experience after taking into effect stock grants and bonuses. The contracting agency probably gets a nice portion of the takehome though (for having the political capital of being on a preferred vendors list), so to the company they probably pay more than salary.
- fortythirteen 9y ago
  You also have to factor in the amount of responsibility for pay. A contractor with decent negotiation skils may net out slightly less than a FT senior dev at a company, but they often have less responsibility than even the FT junior and mid-level devs. Not to mention that they never get dragged into internal company politics or loyalty games. Factor in overtime, or the lack thereof, and you can make more or have far more work/life balance than FTs. That weekend app release? There's an extra $500-$1k that the FTs aren't getting. Company doesn't allow contractors to work over 40 hours for budgeting purposes? Leave at 5 everyday without anyone complaining.

BurningFrog 9y ago

There are two distinct classes of contractors. - Those who aren't good enough to get a full time job. - Those who are too good to settle for a full time job. The two groups are treated quite differently.

kelukelugames 9y ago
Hahaha, I saw someone in the hallway wearing a contractor badge and a MIT hoodies. I am an alum so I asked about their time there. They said they graduated in 2003 but started in 91. I said, "Woah that's one helluva of a PHD." Turns out, they took a 10 year gap to play blackjack. Now they just work for fun every couple of years because they otherwise get bored. https://en.wikipedia.org/wiki/MIT_Blackjack_Team https://en.wikipedia.org/wiki/MIT_Blackjack_Team
taneq 9y ago
Sounds like "casuals" vs. "contractors". Casual staff are often on very similar terms to contractors, apart from the rates of pay, but are seen as interchangeable rent-a-crowd rather than outside expertise.
- dghughes 9y ago
  There were casual workers at the last place I worked some had been there 20 year or more. One day (literally on one day) they were all told they were not needed, no severance, no thanks just let go. Disposable human workers.
octorian 9y ago
I've run into both types. The former are typically a group of second-class employees companies use as a way to "trial" someone before hiring them for real, or simply to skirt the requirements of employing someone full-time. They also tend to work for some shell company you've never heard of, at least on paper. The latter tend to be older folks, and often experts in various fields. They also have little trouble finding another "gig" almost immediately after their current one dries up. These people are usually self-employed.

WalterBright 9y ago

Back when I worked at Boeing, contractors got paid about double what the full time employees did. But, they received no employee benefits (worth about 40% of the employees' salary, if I recall correctly) and could be let go at a moment's notice. So in the end it worked out about the same. If the law requires contractors to get the same benefits, etc., the result will be the contractors will get paid less. The ones I knew wanted the higher pay / no benefits circumstance, and they'd lose that option.

deleted 9y ago

[deleted]

forapurpose 9y ago

> The contractors tend to perform the exact same duties as employees, but are usually paid less, have worse future prospects ... There was a very interesting NY Times article last fall about that issue. They contrasted janitors at Apple, who work for a contractor and have no prospects for advancement in Apple, and Xerox's janitors in the 1980s who were employees, and one of whom is now Xerox's CTO: https://www.nytimes.com/2017/09/03/upshot/to-understand-rising-inequality-consider-the-janitors-at-two-top-companies-then-and-now.html https://www.nytimes.com/2017/09/03/upshot/to-understand-risi... To veer off on a tangent, I suspect it's connected with a new elitism in the U.S. What used to be the celebrated 'Land of Opportunity' where anyone could live the "American Dream' through hard work, regardless of where they started (even if very poor immigrants), is now a place where the children of the wealthy go to college, those of the working class are encouraged to go to trade school, and immigrants are more commonly discouraged.

Camillo 9y ago
You are so wrong I don't know where to start. The percentage of Americans with college degrees has never been higher. For decades, the message from authorities has consistently been to encourage youths to go to college as much as possible, and the number of students has kept increasing beyond all reason. We are well past the point of diminishing returns, and into pure and simple harm, where millions of Americans go into debt to get pointless degree just so they'll be considered for jobs that shouldn't need a degree in the first place. It's a disaster.
- forapurpose 9y ago
  Those claims are trendy, but the parent provides no basis for them and I've never seen one. There's plenty of reason to believe otherwise: The 'youths' want to go to college, and in a free country and a free market, it's believed that they know and decide their own best interests. Businesses in fact highly value college education; they pay people with college degrees much more than people without them. The incomes of people without degrees has been stagnant for decades, and there's concern among economists that their job prospects will become more difficult due to automation. If it had reached a point of diminishing returns (really, small marginal benefit), then the wage differential would be small. As I pointed out above, it's really economic discrimination: Education depends, more than anything, on family wealth. So the outcome of what the parent advocates is that the wealthy classes go to college and the lower classes don't get that opportunity. Usually it's wealthy people with college degrees that say college isn't needed; but tell them that their kids shouldn't go to college and you'll get a much different response. > The percentage of Americans with college degrees has never been higher. That's great. We want people to be better educated, more productive, and live better lives. That's the 'American Dream'. We don't want the economy stuck in the 1980s, but to move forward. It also makes the economy more productive. For example, Silicon Valley can't get enough talented developers, yet the United States (and world) is filled with kids with no access to education, many of whom probably could fill that talent gap. We need more education. High skill, high-paying jobs will go where there are more highly educated workers; if the U.S. cuts college education, it will go elsewhere. New businesses and industries that we haven't yet imagined will arise when they have that resource of educated people. Education also makes people healthier, better citizens, better parents, etc. HN celebrates knowledge; it's hard to suddenly discount it in this case. > It's a disaster. By what measure? The only disaster is that education is too expensive and not available to people without money.

lazzlazzlazz 9y ago

In my experience, contractors are almost without exception worse than full-time employees in terms of the quality of their work. The contractors who stand out get selected for full-time work relatively quickly and consistently.

jMyles 9y ago
> The contractors who stand out get selected for full-time work relatively quickly and consistently. ...but many of us pass on full-time offers nearly constantly. It's not like contractors are just waiting for the day when they are "selected."
richardknop 9y ago
Most contractors I know get full time offers constantly and they keep turning them down :)

dingo_bat 9y ago

In my limited experience contractors are paid much more.

afpx 9y ago

Given all the emphasis in hiring on avoiding “bad” hires at all costs ... I suspect that a small portion of companies use grueling interviews as more of a hazing ritual, and many of the rest follow because, well, that’s just what everyone else seems to do.

e40 9y ago

worse benefits Make that no benefits. In my 35 years in the tech industry I've never seen a contractor that got benefits, since it's the primary reason contractors exist.

walshemj 9y ago

er not in my experience are you confusing w2 contractors hired from a job shop with real self employed ones.