Should your small business use a consultant? by citrus HR

As so many small businesses continue to feel the challenges of the changing economy, we are seeing more and more people use the services of consultants. Choosing to use a consultant for your small business can bring many benefits.

Consultants can provide excellent support on specific short-medium term projects without the requirement to offer contracts of employment. This gives you greater freedom when it comes to managing the size of your team.

However, before taking on a consultant there are a few important things to consider. It’s also vital that you understand that there are differences between your contracted employees and any consultant that you take on.

Key Considerations

A common mistake with small businesses is that there is no harm in treating a consultant in the same way as an employee, after all, they get on with everyone, understand the culture and feel like part of the team.  I hate to be the bearer of bad news, but it isn’t quite this simple. Treating a consultant in this way will blur the lines between the consultant and employee relationship.

Before taking on a consultant you need to be clear that you are content having a different type of working relationship with them. It’s important to understand that the level of control will be different to that of an employer and employee.

For many small businesses this can work really well, but you need to be clear it is right for you! If you are unsure of your needs, speak to a member of our HR support team and they can help offer you guidance on this matter.

Do’s & Don’ts

There are key differences between employees and consultants and blurring the lines can lead to enhanced rights and worse case, costly claims. This is something that is best avoided at all costs.

We talk to small businesses regularly about the easiest way of ensuring boundaries aren’t crossed. The list below gives you some simple points to keep in mind:

Do

• Ensure there is a signed Consultancy agreement in place, something we can support with!

• Ensure there is an end date agreed.

• Allow a substitute to step in and cover the work in the event of sickness and/or holiday.

• Ensure they have the necessary insurances set up.

Don’t

• Provide them with all the equipment required to do the job

• Pay them through the payroll

• Give them a job title similar to those that employees have

• Provide them with a business card

• Set their notice period in line with employees

• Take them on to complete work which is the same as work being completed by employees.

• Stipulate the exact working hours they have to work.

• Advise they can’t work elsewhere

In summary, there are a lot of benefits to using consultants and having the ability to put in place this different kind of working relationship can really have its advantages. However, it has to be done properly. Following our dos and don’t will help keep you on the right track.

Equally, it may not be for you – either way citrus HR are here to support and advise. If you have questions about which contract type would be most appropriate for your staff or whether a consultant would be good for you, get in touch! We are here and happy to help you identify the best options for your business.