“Should I go contract?” is a question that comes up frequently for speech-language pathologists at all stages of their careers. Some SLPs are just starting out and others are mid-career, but feel ready for a change. I’ve worked both as a contract speech path and I’ve been hired directly by various school districts. Let me share my insight into both experiences.
What is a Contract Company?
A contract company or agency is a company that works directly with a school district. A contract company seeks out candidates for open positions. After a school district realizes they cannot fill a position, they will release a contract to a contract company. The contract company then tries to locate a person for that position. The contract company is the middleman between the school district and the employee.
What does Direct Hire mean?
Direct hire refers to a school district hiring an employee directly, without a middleman.
Pros of a Contract Company
- Substantially higher pay – When you work as a contract employee, you receive an hourly wage. That wage is negotiable with the contract company. When I worked contract, I negotiated an hourly rate that included an increase due to my ability to speak Spanish. Additionally, travel stipends are negotiable as well. The hourly rate is typically higher than what a school employee would receive because the contract company does not provide a pension, health benefits, or summer pay. However, health insurance may be negotiated with a contract company.
- Freedom from some of the requirements of a regular employee – Many contract employees can customize their schedules in ways that other employees cannot. For example, when I was contract for a school district with a longer day, I negotiated hours to start a little later than other employees and I could leave 20 minutes earlier than other non-contract employees. Additionally, I did not have to attend certain meetings that other staff attended.
- Social security-based pay – Because a school-based contract employee does not earn a pension, they have a Social Security-based position. That can be an advantage for people who are concerned about pension funding (but other people worry about the funding of Social Security). Additionally, keep in mind due to the windfall provision, a person cannot collect full benefits from both Social Security and a pension. Usually, the Social Security benefit is reduced when the participant has a pension.
- More flexibility between schools and other settings – Working for a contract company means that if something is not working out in one school, district, or setting, a contract company will most likely have contacts and placements across many different settings.
- Ability to float geographically – Contract companies have branches all throughout the states – and potentially abroad as well. If you want to work in another state and you are unfamiliar with the area, going contract would be a great way to familiarize yourself with your surroundings.
Cons of a Contract Company
- Less job security – School districts cancel their contracts with contract companies frequently. It can sometimes be as frequently as yearly – it depends on union rules. So even if the district expects to have a vacancy in the next year, they might have to release you and attempt to hire a direct employee. Additionally, if there is a shortage in cash, the contract employees are the first to be dismissed. That is because of the lack of union coverage.
- No union membership – A contract employee usually lacks the benefits and the protection from the teacher’s union. If access to a union is important to you, this is something to consider.
- No summer pay – The hourly rate of pay for contract employee only is paid for time spent in the building. The contract company does not typically hold money aside to distribute during the summer. If you are able to manage and save money for the summer, you should be fine; however, budgeting is a challenge for a lot of people. There’s nothing worse than running out of money during the summer.
- No pension – The contract company will not be putting money into a pension for your future retirement. However, obtaining a personal 401K or a 403b could be an option, depending on your contract company.
- Feeling different and apart from regular staff – When I was a contract employee, I felt different from the regular staff. They included me as much as they could, but I still didn’t feel a part of the staff. I was often left out of the loop when there were school meetings and discussions about things that related to the district. I’m assuming this varies greatly in schools and districts.
Let’s pretend you are making a choice by going through a couple case studies.
I’ve worked for a few years for a district in the Midwest. I want to spend a year in Hawaii learning how to surf. Should I sign up with a contract company or should I work directly for a district? Here you could work for a contract company. That’s because working in Hawaii sounds like a fun adventure – not a permanent move.
I’m looking at a position with the district in which I live (we own our home) and where my children will be students. I could go contract or I could work directly for the district. It sounds like you really want to put down roots in the district. Your best move is to work directly for the district because the long term gains in salary will outweigh any short term pay increases.
I’ve just relocated to another state where I don’t know anyone and I’m not sure about which school districts are the best for speech paths. I feel like I could go either way. Contract seems to be a good move here until you know more about the area. After a year of figuring things out, you can look around and decide where you should work.
Deciding between a contract company and being a direct hire
Overall, I think that most people should be a direct hire over working for a contract company. Over the long term you will make more money and have more job security. I hope this helps your decision making.