6 Tips to Help Transition from Freelancers to In-House Employees

Freelance work is a great source of talent for your small business. But as your company grows, you may become interested in adding more in-house talent to your team.

To navigate this change successfully, make sure you follow these six tips:

Hire Cautiously

Hiring a new in-house employee is completely different from hiring a freelancer. Both you and a freelancer know the relationship may be temporary, but in-house employees have different expectations and it’s generally a longer commitment. Of course, you can let the employee go if things don’t work out — but you may have expenses like severance pay or unpaid vacation to disburse.

You’ll also be making a bigger up-front commitment in terms of office space, supplies and, importantly, health benefits costs. Because of these factors, be deliberate about your interviews and don’t rush the process.

Line Up Your Expenses

Before you take the plunge, make sure your budget can handle the switch. With the in-house talent, you’ll be covering additional expenses like taxes and health care costs. Consult your insurance broker or accountant to see how much extra each employee will cost. You’ll also need plenty of office space to accommodate the new hires and the budget for computers, phones and office equipment.

Look Into Extra Benefits

The competition for attracting in-house talent can be more arduous than you typically experience when hiring freelancers. Your interviewees’ expectations will also likely be higher. That’s why you should be creative in offering benefits to attract top quality talent, even if your budget is small.

These benefits can include telecommuting, time-off for doctor’s visits or to care for sick children, giving birthdays off or even wellness extras like pet insurance and free gym memberships. Help your employees grow professionally by funding a seminar or workshop every year. Showing that you value your employees by offering benefits they appreciate puts you ahead of the competition.

Make Your Expectations Clear

You may have a freelancer that you want to bring in-house because his or her work is top-notch. This can be a great opportunity, but make sure you clarify all of your expectations first. Freelancers are used to having freedom in their schedule and autonomy in their work.

You’ll need to be clear about topics like work hours, lunch breaks and vacation days. But if you want this person on your staff, consider building more freedom into your policies. Allowing flex hours or telecommuting is a real benefit to someone who’s used to the freelance lifestyle.

Explain the Tradeoff to Potential Hires

Freelancers often make more money per hour than full time staff, but they don’t get the same benefits. When making your employment offer to someone who’s been freelancing, either for your company or elsewhere, make sure he or she understands the tradeoff. While a full time salary may be lower per hour than a freelancer’s hourly rate, they’ll often more than make up for this in benefits. If a freelancer is able to join your employer-sponsored health plan, for instance, they’ll save big over what they could afford on their own. There are other benefits to being full-time like paid vacation that freelancers don’t get, so be sure to frame up the whole package.

The Benefits Can Outweigh the Expenses

Yes, transitioning from freelance work to in-house talent can increase your expenses. But in many cases, the benefits outweigh the costs. An in-house employee’s success is directly tied to the company’s success, which builds loyalty, according to Kissmetrics. You’ll also have access to your employee any time during work hours, rather than waiting for specific meeting times to chat. This can lead to greater productivity and efficiency, as well as higher quality work.

There are benefits to transitioning from freelancers to in-house staff. Just do your research first and proceed slowly.

This content is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.

Stephanie Dwilson has extensive experience providing expertise on topics including health, law and marketing. She’s a science journalist published by Fox News, a marketing expert and an attorney with expertise in personal injury law. She’s also a small business expert featured by Businessweek and Millionaire Blueprints magazine and has worked as a marketing consultant for ministries and as a PR lead for one of the largest churches in America.

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