Fixer: Should we give casual worker an employment contract?

She works with us three days a week and we've put her time into next year's budget, but we're concerned about unforeseen problems arising

Two years ago we took on an intern. She then got a part-time role with a different organisation, but we wanted her continued support on a project so offered her a consultancy agreement to work for us one day a week. She’s now working with us three days a week, is no longer doing her other job, and we’ve even put her time in the budget for the next financial year. She’s asked if she can be put on a full employment contract instead, but I worry about opening ourselves up to unforeseen issues if we commit to this. Are there any pitfalls to either option that we should consider when deciding whether to switch her over?

Let’s examine this scenario from three perspectives: the work itself, consultancy versus employment and legal considerations. For me, the work is where we need to start to ensure you make an objective business decision on which might be the best resourcing model, and not have it potentially influenced by the outcome your consultant is looking for. Based on what you have outlined, the work has increased from one day a week to three days, and is already in the budget for the next financial year, so appears to be an ongoing business need for which full employment would provide additional stability. 

From a consultancy versus employment perspective, consultancy would continue to allow more flexibility should the need ever change, and maintain a likely lower overall cost. On the other hand, employment would secure this consultant’s (or potentially an even stronger candidate’s) skills longer term, providing them with the benefits and compensation they need to stay committed, etc. 

Regarding legal considerations, it appears the consultant was first on a direct intern contract and subsequently a consultancy agreement, which hopefully was reissued to reflect the increase from one day a week to three. Permanent employment would only begin from the date that contract is issued, so we should not be dealing with continued service, longer-tenure employment rights, etc.