There are a number of reasons behind why contracting is so lucrative for businesses. Some of these decisions are made behind the scenes, but many others are done face-to-face.


Promising contracted employees a certain amount of compensation and then giving them less when it comes time to sign Try to tell you to work without claiming your hours because it will help you get an FTE position (this is wage theft) Placing a higher volume of work, a greater number of hours, and providing less pay to employees with H1B visas. When you’re negotiating with a recruiter from an agency they are incentivized to lowball you


Letting go of all contractors at once, including ones who they have promised to convert to FTE Converting a fraction of TVCs while firing others. Many companies that are considering converting you will have to pay out your entire salary to the contracting company in order to convert you to an FTE position. For most companies, it’s a lot cheaper to keep you on as a contractor, or even fire their FTE workforce and rehire them as contractors.


Isolating employees into one-on-one meetings instead of group meetings In some workplaces (especially large tech companies) other FTEs can’t give you a referral for the company or even a recommendation. They may not be allowed to evaluate your work. Your manager may not ever be clued in on what it is you actually do. Forced arbitration: When you sign your contract you may forfeit the ability to hire your own lawyer if something goes awry, and instead will have to go through the legal procedures that the company chooses. Buy-offs: Among a team of contractors, the tech company or contracting company may try to promote or reward a single individual in an attempt to keep contractors from asking questions. The contracting company and tech company will often both play like no one is in charge of managing you or controlling your wage, and will deflect responsibility for your work and compensation Giving FTEs training on what they can and can’t do with contractors and creating a culture that discourages different types of workers from communicating directly with one another implying that FTE jobs will be at risk if FTEs communicate directly with contractors.