Growth

Oct 21

What’s fractional employment and how’s it different from freelancing?

Trevor Sookraj

It goes without saying: today’s work landscape is constantly changing and evolving.  For talent—even in your ideal job, there’s still room for growth and challenges that you won’t be able to see unless you leave. Therefore, full-time work is inherently restricting.

With that, many people are looking to fill their free time with a “side hustle” that provides extra income, as well as an opportunity to do things a little differently from their regular 9-5. While some turn to part-time or freelancing, others are turning to fractional employment, an option that brings the best of both worlds: the flexibility of a freelance position with the meaningful experiences of a full-time one.

But what exactly is fractional employment? In this article, we’ll break down fractional employment: what it is, what makes it different from freelancing, and why you should consider it as your next career move.

Before we dive in, let’s first understand the basics of freelance employment and how it differs from other employment models.

What is freelancing?

A freelancer is an individual who works for themselves, as opposed to a company or employer.  They are hired by clients as an independent contractor on a short-term, per-project or per-job basis. Freelancers can be thought of as a part-time worker with a company that has other projects to focus on as well.

Roles that are transactional are typically a better fit for freelancing. These roles can be done autonomously, where the freelancer isn’t blocked by the rest of the team, and the employer can scope the work to a short-term project. For example, copywriting is a great role for freelancing as a writer can be paid on a per-article basis, and outside of a brief, minimal collaboration is needed from other members of the company. On the other hand, product management wouldn’t suit freelancing, as product managers need to have a strong understanding of the business and be well-integrated with the rest of the team (developers, engineers, etc.).

Pros and cons

There are many benefits that come with freelance employment. Freelancers can work remotely as they don’t rely on resources provided by their employer (i.e. use your own laptop). They have the flexibility to create their own work schedule, giving them better work-life balance. Freelancers also have the final say in what they work on; a full-time employee is generally expected to do the work given to them, but a freelancer has the choice of what the projects to take on. And because they work for themselves, freelancers are able to set their own rates, giving them full control over how much they earn for their work.

While freelancing does have many benefits, it also has its cons. A major one is the lack of job stability; because freelance work is mostly short-term and on a per-project basis, freelancers can’t always be certain about their income and whether they’ll have work in the future. Freelancers also miss out on benefits, insurance, and retirement plans that are often offered by employers to full-time employees. Additionally, freelancers often do not get full visibility on a whole project; they only see the specific parts that their work is directly related to, which can lead to feeling less fulfilled with their work.

What’s the difference between freelance and self-employed?

Freelance work is similar to being self-employed in some regards, like in the level of autonomy and freedom it offers, but different in others. It’s important to understand that freelancers are always self-employed, but self-employed professionals aren’t always freelancers. In fact, most self-employed professionals are actually entrepreneurs and/or business owners. The key differences between the two are outlined in below.

Another important thing to note is that being self-employed doesn’t necessarily mean a person doesn’t have a day job; in some cases, a person might choose to maintain their 9-5 as a main source of income, while doing work on the side. A person could technically do all three: work a day job, freelance for clients, and upkeep their own business. From a legal perspective, self-employed individuals are required to pay taxes on income earned while freelancing or from their business.

What is fractional employment?

While freelancing is a common option and gets a lot of attention, fractional employment offers a different opportunity to those looking for additional work.

Fractional employment is when an employee works for a “fraction” of the time of a full-time employee. Similar to freelancing, fractional employment provides workers with a lot of flexibility and autonomy. But it differs in that it’s more involved with the company compared to freelancing. Fractional employees are not project-based; they have a holistic approach, so they are more integrated into the company. They have a better understanding of the company’s goals and have regular conversations with its team members.

When a founder needs help with growth in their company, but doesn’t have enough work for a full-time hire, this is where fractional employment comes in. The work is not project-based or temporary in nature, so they approach someone who has a strong growth background and 10 or so hours a week available to work with them. The person works in the same practice (i.e. growth) as their day job, so they aren’t reliant on the income long-term, but they also aren’t expecting a short-term gig.

As we’ve mentioned, fractional employment has benefits similar to freelancing: flexibility, autonomy, and of course, extra income. But a unique benefit fractional employment offers is the opportunity to touch different projects outside of a regular 9-5.

Working fractionally often opens the eyes of employees to see different perspectives and solutions that they can bring into other areas, including their full time job. Not only that, but the experience hones their knowledge and skills, making them more competitive in the job market and overall, furthering their career.

How do I know if fractional employment is for me?

These are a few indicators that fractional employment would work for you.

You have a remote job

Fractional employment works best for people with a full-time position that is remote and provides a lot of flexibility. While it won’t be as often as a full-time position, meetings are still required of a fractional role, and it would be tough to attend them if you’re working in an office.

You’re well integrated into your full-time role

Consider your level of comfort with your day job—if you’ve just started a new role, then it’s likely you won’t have the headspace or rapport with your team to take on additional projects. (No one wants to start a new role if they’re unsure about how they’re doing with their main role.) Also consider your direct reports; if you have more than one direct report at your full-time job, it’s likely that you’ll have less ability to craft your schedule and balance working fractionally.

You enjoy a specific part of your job

Fractional employment is a great option for people who enjoy doing a specific part of their job and would like to get more exposure in that area, while honing their knowledge. Fractional work gives you the chance to gain more reps in areas you want to; for example, if you’re interested in strategy and would like to get more experience in it, you could look for fractional work that deals more with strategizing and delegating others to do executional work as opposed to a full-time job where you might have to juggle both.

In a recent interview with one of our fractional Heads of Growth, Eva, she outlined this exact point:

“The way I see working fractionally and why it’s great is that it captures the part that I really like, and I can just do that part.”

Eva really enjoys being a part of a company’s growth through advising them, rather than executional work. At Divisional, she’s paired with clients that let her do the part of the job she loves.

You can solve specific problems

Lastly, fractional employment works best for those that are suited for specific types of problems that an employer will encounter. Fractional work often involves ambiguity, where you are required to solve a problem with minimal time and communicate the resources you need. You won’t be given the same leeway as your full-time job, as employers will expect you to ramp up quickly and make an impact. If you don’t feel well-equipped to tackle problems, then working fractionally might not be the best idea.

What’s the difference between fractional and freelance?

The key thing that differentiates fractional employment from freelancing is its approach. Since freelancing is mostly project-based and the outcome of freelance work relies heavily on client requests, these workers are often seen as “separate” from the rest of the company. On the other hand, fractional employees are often integral members of the team, and their impact is closer to that of a full-time employee, just without the same time commitment. In fact, fractional workers are not only part of the team, but can manage them. If you have a good fractional resource, they can manage other team members such as writers and VAs. They help to free your time and headspace up to tackle other things, as opposed to simply taking execution off your plate.

Fractional hires are also able to deal with ambiguity in a company and chart a path of how they’ll make an impact. Again, fractional isn’t transactional in the way that freelance is; remember when we said freelancing sometimes leaves its workers feeling unfulfilled? Fractional employment is the opposite of this—these employees are embedded within the company and are invested in (and held accountable to) its success.

Can I work fractionally while employed full-time?

One of the best parts of fractional employment is that its flexibility allows a person to work a full-time position at the same time. When a company hires you for fractional employment, they know that you have a full-time role elsewhere, and will only be able to work certain hours. At Divisional, we understand the responsibilities that our team has in their regular 9-5, so we never place them with a client that’d be competitive with their full-time role.

Think about it this way: if you had a hobby outside of work (e.g. a baseball league), your employer would never balk at it. That’s because there’s an assumption that, 1) you’re doing well at your job, so playing baseball outside of work won’t affect your performance, and 2) you won’t put baseball (i.e. practices, games) before work. Fractional employment follows the same concept: it’s something you do on the side that won’t take priority over your day job.

Final thoughts

Overall, fractional employment is a great way to gain experience, hone your skills, and earn extra income. If fractional employment is something you can see yourself doing, Divisional may be the place for you. Get in touch with us today!

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