Software Engineering Company, Umbrella Company, and Freelancing: User Guide

Are you an IT consultant, specialising in a web development or digital field, wondering what the ideal job status is for your career? This is perfectly normal.

The IT sector is changing rapidly and relationships with Software Engineering Company are no longer as binary as they used to be. You now have the choice between several statuses: Salaried, Freelancer (i.e. independent consultant), and a Portage Salary under an umbrella company. How do you navigate these choices?

Let us explain. 

Why work for a Software Engineering Company?

Before choosing the ideal status, let’s remember what a Software Engineering Company is: a Digital Services Company, also called IT Consulting Company. They support clients with their consulting work and carrying out major web and IT projects. These customers are often large groups from all sectors: Véolia, L’Oréal, EDF, Orange, as well as start-ups and SMEs with high development potential.

The job profiles working for Software Engineering Companies are, therefore, mainly related to IT and digital fields: web developers, web security consultants, data analysts or data miners, blockchain engineers, digital marketing experts, UX / UI designers, SaaS consultants, infrastructure administrators, and many others.

IT Consulting Companies make sure to place these consultants with their clients to support and carry out ambitious and innovative projects, with assignments ranging from a few days to several months or even years. The main Software Engineering Companies in the UK are Deloitte, IBM, and Accenture.

Working for a Software Engineering Company: salaried, freelancer, or working under an umbrella company?

Joining an IT Consulting Company is, therefore, a superb opportunity to work on extensive projects in large groups and gain significant experience (whether through independent consulting or from within the operation).

It is also an opportunity to vary projects and businesses, bringing new rhythm and diversification to your career.

Several statuses are available to you to work for these large consulting firms or IT service companies. So here are the major differences between these three options, including their advantages and disadvantages.

Salaried: 
you are directly employed by the IT Consulting Company

 The most traditional option, although it tends to be less and less popular since the recent evolution of freelancing and becoming part of an umbrella company. It’s a simple solution, which allows you to learn skills as an employee and discover large companies as an external consultant, while also keeping the security of a full-time contract. You don’t have to canvass your clients, but you can’t pick your assignments and are faced with a hierarchical system.

Benefits:

• You are paid, even between assignments

• You benefit from the general plan (i.e. social security, retirement, unemployment)

Disadvantages:

• You rarely decide which assignments you receive and the clients you work for

• You are faced with the hierarchical system of the client and the IT Company     

• Lack of autonomy

•  Lower salary (than as an independent consultant)

Freelancer: 
you are a service provider for the Software Engineering Company

A solution that has become increasingly popular since the early 2000s: become your own boss by becoming an independent freelance consultant. You make your IT and web skills available to the Software Engineering Company which will then place you with one or more clients. The difference is that you have complete freedom to accept or refuse a mission (according to your interest in and skills for it).

Benefits:

• You get better pay for the same amount of work hours

• You have the choice of assignments

• A better view of your professional organization

• The hierarchical aspect is almost nonexistent: you become a service provider

Disadvantages:

• You must create your limited company. 

• You must take care of all the administrative and legal aspects

• You must manage your accounting or employ an accountant

• The total time devoted to your expertise is therefore reduced

•  You are not paid between assignments

• You must find your private health insurance company, choose a supplementary pension, etc.

Portage (i.e. working under an umbrella company): 
a hybrid format where you become an employee while remaining 100% independent

 This third option has been a dazzling success since the end of the 2010s (and for good reason). Working under an umbrella company combines all the advantages of a permanent contract without the disadvantages! Indeed, the consultant becomes an employee of the umbrella company, but decides their clients, missions, and work hours, without any hierarchical relationship.

The umbrella company takes care of all the administrative management and invoicing of IT assignments directly with the Software Engineering Company and pays the remuneration of the independent consultant in the form of a salary. This allows the consultant to concentrate on their activity, without any administrative or accounting procedures. The consultant, therefore, remains a freelancer and independent, while benefiting from the advantages of the general plan reserved for full-time contracts (and also much easier access to bank loans and other benefits usually reserved for traditional employees). 

Benefits:

• You get better compensation than a traditional employee

• You remain 100% independent in the choice of your missions

• You remain your own boss

• No more accounting or administration

• You are on a permanent contract, so you contribute to the general plan (so that you benefit from private health insurance and unemployment)

• Some umbrella companies offer premium services such as a company car, nursery places, etc.

• Hightekers offers you a Premium umbrella service, where you also become a partner of the company (allowing you to receive a variable in case of good results)

Disadvantages:

• You are not paid between assignments

What is a Premium Umbrella Service for IT Consultants working for a Software Engineering Company?

You will soon understand that working under an umbrella company allows freelancers to overcome the drawbacks of freelancer status while continuing to be able to work serenely in large IT Consulting Companies as a freelancer. Hightekers was able to revolutionize the sector by going even further and creating the status of Premium Umbrella.

In addition to traditional umbrella company services, Hightekers Premium Umbrella services offer the IT consultant a community and international network, as well as high-end services. Here are the advantages of Premium Umbrella:

Hightekers deals directly with a large number of Software Engineering Companies and has an established rapport and partnerships with these companies. Therefore, there is no payment deadline: the independent consultant is sure to get their salary at the end of the month.

Hightekers helps you negotiate with Software Engineering Companies for ADRs (Average Daily Rates) that fully value your expertise.

Hightekers offers you the status of a partner in the company: you become part of the success of Hightekers, you can refer future IT consultants, and you receive variable compensation at the end of the year (depending on the results of the business).

This partner status gives you the opportunity to belong to the Hightekers’ network: a powerful community of independent consultants in the UK and internationally.

You have the opportunity to take advantage of top-of-the-range services: long-term vehicle rentals, savings products, nurseries/childcare, etc.

Hightekers is established all over Europe, with local branches in Paris, London, Brussels, Madrid, Geneva, and Milan. You can, therefore, move easily and become a freelancer abroad while letting Hightekers take care of everything and offer you a local contract (thereby simplifying your new life). 

Want to join the movement and community of independent IT consultants? Get in touch today!