Service - Performance Gap: Employee vs.
Contract
How can contracting executive / management services be
so cost effective? The simple answer is that the service is a business
contract not an employment contract. This focuses on pay for results
not time. It
also eliminates the associated costs of benefits, hiring and
termination.
| Item |
Employee |
Contract Services |
| Salary |
$100,000 |
$99,000 |
| Statutory Benefits |
$18,000 |
Nil |
| Company Benefits |
$14,000 |
Nil |
| Hiring Costs |
$36,000 |
Nil |
| Termination Liability |
$50,000+ |
Nil |
| Pension Liability |
subject to Plan |
Nil |
| Total Costs |
$168,000 |
$99,000 |
| Total Annual Costs |
$132,000 |
$99,000 |
| Total Liability |
$50,000+ |
Nil |
| Performance Valuation |
$46,200 |
$99,000 |
| Return on Services |
36% |
100% |
| Service Gap |
-$85,800 |
0.00 |
Service Performance
Advantage to You:
What is your Service - Performance Gap? This is the
real waste you are paying for employment of services which are more
effectively delivered by contract.
