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Employee or 1099?

My friend Wes Dumey does a lot of work in the business intelligence sector as a contract employee and has a post worth reading called The Great Debate - Employee vs. Consulting. I don't agree with all of his points, but it's an interesting conversation to have. I do agree that too many of us seem overly focused on benefits, rather than just looking at the dollar value of the benefits and adjusting the wage accordingly. For example, I pay about $6k a year for health insurance for my family. It doesn't matter if I make $100k and get free insurance, or make $106k and pay my own, I net the same (assuming benefits are comparable/reasonable). The challenge is that employers have to put everyone in the insurance pool to get the rate, and so as an employee you can't negotiate for that extra $6k easily (and the same for the 401k match). But as a contractor, all doors are open - you just have to understand your own costs, financial goals, market value, and then ask!

I don't want to comment much until Wes does part 2, but I'll finish with this; most of us prefer to be employees for three reasons:

  • We don't like any level of uncertainty in our lives and are willing to trade some percentage of salary for stability - human!
  • We like being part of a team - human!
  • We were never taught to be entreprenuerial - human perhaps, but a bigger failing in the education/mentoring picture

Wes has posted Part 2 before I get could this posted, so I'll wait on his Part 3 to finish my thoughts.


I'm Andy Warren, currently a SQL Server trainer with End to End Training. Over the past few years I've been a developer, DBA, and IT Director. I was one of the original founders of SQLServerCentral.com and helped grow that community from zero to about 300k members before deciding to move on to other ventures.


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