Freelancer vs. Consultant? What’s the Difference?

Are you a freelancer or a consultant? The distinction between the two terms might not appear overly important at first blush. But in a world where words have the ability to shape our own behavior and the attitudes of the people around you, how you define yourself as a contract worker can actually impact your work environment, your earnings, and the way your customers treat you.

First let’s talk about definitions. The term freelance or free lance, has its roots in the ancient days of horsemen and knights, where independent mercenary soldiers acted on behalf of a king for money. The term today continues to describe, according to “Merriam-Webster’s Collegiate Dictionary,” “A person who pursues a profession without a long-term commitment to any one employer.” Consultant, on the other hand, is a more modern term to define someone who “consults” or “one who gives professional advice or services,” to quote Webster’s. The term implies a certain amount of expertise, while certainly freelancers and consultants have knowhow.

These days the terms freelancer and consultant are often used interchangeably. But there are some key distinctions:

  • A freelancer is someone who usually works at home and the work comes to them. They use and own their own tools and are responsible for maintaining them. A consultant–described perhaps as a more transient type of employee, likely works in client’s office with tools owned by the client. The client controls the tasks you work on and the timeline.
  • Consultants may broker themselves through staffing or consulting firms or may sometimes seek out clients independently without an intermediary. They may also get three to four W2s at the end of the year, according to Dan Pink, author of the book “free Agent Nation,” which discusses the growing ranks of self-employed people. These consultants could be almost considered like temporary employees, part of a company’s contingent staff.

Crucial for the economic viability of independent contractor–whether freelancer or consultant–is the ability to stay employed. Even as a consultant contracted with a staffing firm, the minute you start costing the firm money and stop making them money, you have a bulls eye on your back, and are at risk being unemployed.

So to protect yourself, we have developed the Consultants Bill of Rights for those people who work as a consultant and who broker themselves through consulting or staffing firms.

The Consultants Bill of Rights includes:

  • The ability to decide what projects you work on;
  • The ability to decide when and where you work;
  • The ability to decide how much work you do in a year;
  • The ability to know and influence your bill rate to end clients;

You should have your own 401k or SEP retirement account and a rainy day fund.

The point of The Consultants Bill of Rights is not to badger or harass staffing companies, nor to be a Prima Donna. Simply put, THE CONSULTANTS Bill of Rights is your reminder to go the extra mile to ensure your security and happiness as part of the independent workforce.

Ten years ago, all staffing firms would tell you when and where to work. It didn’t matter that you had to make a two-hour commute through the winter, you did it.

But today, the consultant has to be in charge of knowing the market so that the attractive gigs keep coming your way.

With so many staffing firms to broker you, and with so much contract work around, there’s no reason to be at the mercy of anyone.

As an independent contractor, “You’re The Man.” You’re making more money, you have more control over who you work for, more control over the types of projects you work for, and you should even have a say over what your billing rate to end clients is going to be. If not, you may find a staffing firm pricing you right out of the market and out of some gigs that you might want.

You’re beholden to stay on top of the market rates, using tools such as HotGigs.com‘s Rate Exchange, where you can report the details of your engagement and compare yourself instantly with other people in your market.

At the end of the day, whether you’re a freelancer or a consultant, you’re the responsible party for making a bright and successful future for yourself – no one else.