VedyanOctober 20, 2026 · 6 min read · Vedyan team
For permanent IT roles, companies usually choose between contract-to-hire and direct hire. Both end with a full-time employee, but they differ in speed, risk and how cost is spread over time.
Contract-to-hire
The consultant starts as a contractor, usually on the staffing firm's W2 payroll, for an agreed evaluation period, often three to six months. If both sides are happy, the consultant converts to your payroll, typically under conversion terms agreed in advance.
- Lower hiring risk: you see real work before making an offer
- Faster start: contract onboarding is usually quicker than a full hiring process
- Higher hourly cost during the contract period
- Some strong candidates prefer a permanent offer from day one
Direct hire
The candidate joins your payroll from the first day. A staffing partner sources and screens candidates, and you usually pay a one-time placement fee when the hire starts.
- Best for leadership and hard-to-fill roles where candidates expect a permanent offer
- Lower total cost over a long tenure
- Higher stakes if the hire doesn't work out, so screening matters more
- Most placement agreements include a replacement guarantee period
A simple way to decide
- Unclear role or new team: contract-to-hire
- Urgent capacity need: contract or contract-to-hire
- Senior or leadership role: direct hire
- Competitive market for the skill: direct hire, to avoid losing candidates
How Vedyan helps
Vedyan supports contract, contract-to-hire and direct hire, so you can choose the model per role rather than per vendor. We agree conversion and guarantee terms in writing before the first candidate is submitted.