Locum vs Permanent: Choosing the Right Model

Most healthcare professionals will weigh up locum or contract work against a permanent role at some point, and often more than once across a career. It is one of the bigger decisions you can make, yet it is frequently settled on a single factor: the daily rate, or a need for more flexibility. The full picture is more interesting, and far more useful.

This article continues the Gorilla Jobs series on managing a healthcare career deliberately. The honest answer to “locum or permanent?” is that neither is better. They are two different ways of working, with very different day-to-day realities, and the right one depends on your stage of career and your life right now. What follows is a practical, side-by-side comparison, drawn from what we see placing clinicians into both. Health Care and Social Assistance is Australia’s largest employing industry, and demand is strong, so both options are widely available. Source.

Key Summary

• Neither model is better. Locum and permanent work are two different ways of working that suit different career stages and circumstances.
• Locum work is built around flexibility and mobility. You choose when and where you work, and travel and accommodation are commonly arranged and paid for placements away from home.
• The headline rate is only part of the picture. A locum rate has to cover unpaid leave, gaps between bookings and your own admin, and it rises for night shifts, after-hours work and senior in-charge or supervisory roles.
• Permanent roles trade a lower headline figure for stability: paid leave, predictable income, an embedded team and clearer progression.
• A well-negotiated permanent role can be shaped to you. Days, hours, caseload mix and study support can often be tailored, in a way a locum placement usually cannot.
• Credentialing is real work upfront, but once you are credentialed with a health service, returning for more shifts is simple.
• Superannuation, insurance and your employment classification still need sorting whichever model you choose. Confirm them, and get advice.

Locum vs Permanent: The Real-World Comparison

Start with what each model actually is. Locum and contract work means being engaged for a defined period or for specific shifts, paid per shift or per day, usually through an agency and sometimes directly by a health service. You step into a role that already exists and work within the structure around it. Permanent employment means an ongoing role with one employer, a salary, paid leave, and a place in a team you build over time.

One thing to know early: “locum” is not a single legal category. Some locums are engaged as casual employees, and some work as independent contractors through an ABN. That difference affects how you are paid, taxed and covered, and it is worth confirming for any placement. Here is how the two models compare in practice.

The rate is not the whole story

A locum rate almost always looks larger than a salaried equivalent, and on a single shift it often is. But the rate has to do more work. It has to cover the leave you are not paid for, the gaps between bookings, and the time you spend on your own admin, tax and accounting. Casual and locum work generally does not include paid annual or personal leave; where you are engaged as a casual employee, a casual loading is meant to partly offset that. Source. The headline figure is also not fixed. Night shifts and after-hours work typically pay more than day shifts, and more senior responsibility, being the doctor in charge or supervising junior staff, usually pays more again. This is the same logic our Cost of a Better Offer article applies to salaried roles: compare the full picture, not the headline number.

Logistics: who pays you, and who arranges your travel

Two practical points often surprise people new to locum work. First, who pays you can vary. Depending on the state and the health service, you may be paid directly by the hospital, or through the agency that represents you. Second, travel and accommodation for placements away from home are commonly arranged and paid for, particularly for rural and regional work. That is a large part of what makes locum work mobile in practice: you can take a placement in another town, or another state, without carrying the cost of getting there or staying.

Credentialing and the revolving door

Credentialing is the process a health service uses to verify your qualifications, registration and background before you can work on site. It is real work, it is largely state-based, and it can take anywhere from a few weeks to a few months, so it pays to start early. The upside is that it is front-loaded. Once you are credentialed with a particular health service or district, returning for more shifts there is far simpler. For a clinician with personal ties to a particular city or region, this becomes a revolving door of available work: do the paperwork once, then go back as often as you are available. Our article on why credentialing matters for locum doctors covers the process in more detail. Credentialing is most involved for hospital-based and medical locums; agency and contract work in nursing and allied health has its own onboarding and compliance steps, usually lighter.

Fitting in, or shaping the role

This is one of the clearest differences, and it cuts both ways. As a locum, you step into a role the hospital has already defined. You work within its rosters, its caseload and its systems, and there is limited room to change them. A permanent role is the opposite. Negotiated well, and often with a recruiter advocating for you, a permanent position can be shaped around what you actually want: specific days or hours, a particular caseload or patient mix, or support for education and professional development. If tailoring the job to your life matters to you, that is a point in favour of permanent, provided you negotiate it properly rather than accepting the first version offered.

Which Model Fits You, and When

Because neither model is better in the abstract, the useful question is which one fits where you are now. For most clinicians, the answer changes over a career.

Early career

Early on, structure usually matters more than flexibility. A permanent role tends to offer consistent supervision, a stable team, and a clear development pathway, all of which build a foundation. Locum work can be done early, but without consistent support it can stretch a less experienced clinician thin. If you are still consolidating your skills, the embedded support of a permanent role is often worth more than a higher rate.

Mid career

This is where the choice is most open. By mid career you have the experience to work effectively in less familiar settings, which makes locum work viable and often appealing: flexibility, variety, higher rates, and control over your calendar. Permanent work at this stage offers progression, leadership pathways and stability. Many clinicians weigh these carefully and could reasonably go either way.

Later career

Locum work can be a useful way to ease toward retirement. It lets you dial your load up or down, choose work that suits you, and keep practising without the full weight of an ongoing role. The geographic freedom can also suit this stage of life.

Life circumstances matter as much as career stage

Stage of career is only half of it. Caring responsibilities, study, a desire to travel, or rebuilding capacity after a break all push the decision one way or the other. Locum work also suits clinicians with strong ties to a particular place. Once credentialed there, they can return for shifts around family, property or community commitments. And the choice is not permanent. Plenty of clinicians move between locum and permanent work more than once, as their circumstances change.

Making the Call

When it is time to decide, a simple sequence helps, in the same spirit as our guide to choosing between two offers.

Start with your floor

Set two floors before anything else. The first is income: the amount you realistically need. The second is stability: how much income variability you can carry without it causing real stress. Locum work can pay well, but if an unpredictable month would worry you, that matters more than the rate. If both models clear your floors, the decision moves to fit, not finances.

Then weigh fit

With the floors cleared, weigh the things this article has covered: flexibility and control, variety against depth, development and team, travel, and how well each option suits your life right now. There is no scoring system. The pattern is usually clear once the money is set aside.

Sort the practical details, either way

A few things need to be right whichever model you choose. Confirm your employment classification: locum arrangements differ, and whether you are a casual employee or an independent contractor affects your tax, your super and your entitlements. From 26 August 2024, a whole-of-relationship test determines this. Source. Superannuation usually still applies to locum work: if you are paid mainly for your own labour, super is payable even if you invoice through an ABN. Source. Check that your professional indemnity insurance covers every aspect of your work, since all registered practitioners are required to hold appropriate cover, and an employer’s policy may not extend to locum work. Source. And if you are employed by a public or not-for-profit health service, it is worth asking whether salary packaging is available, as it can be a useful benefit. Treat that as a prompt to ask, not as advice; confirm the detail with your employer and a qualified financial adviser. Source.

Avoid the common mistakes

Three mistakes come up often. The first is choosing locum work on the headline rate alone, without pricing in unpaid leave, downtime and admin. The second is staying permanent purely out of inertia, when flexibility is what you actually need. The third is accepting a permanent role exactly as offered, when days, hours, caseload or development support could have been negotiated. A recruiter who knows both markets can help you compare real options, and handle the credentialing if you go the locum route.

Conclusion

“Locum or permanent?” is not a question with a fixed answer, and it is not a question you only answer once. Locum work offers flexibility, mobility, variety and a strong rate, with less stability and more paperwork. Permanent work offers stability, progression, an embedded team and a role you can shape over time, in exchange for a lower headline figure. Both are good ways to build a healthcare career.

The clinicians who choose well are the ones who look past the rate and ask a more honest question: which way of working fits the life I am living right now? Answer that, sort the practical details, and either path can be the right one.

Disclaimer: This blog is a general overview and should not be construed as professional legal, financial or medical advice.

FAQs

• Is locum work better paid than permanent work?
  

  Locum work usually has a higher headline rate, and night shifts, after-hours work and senior in-charge roles can lift it further. But the rate has to cover unpaid leave, gaps between bookings and your own admin, so it is not a direct comparison with a salary. Whether it pays better overall depends on how consistently you work.



• Do locums get superannuation and leave?
  

  Locums generally do not receive paid annual or personal leave; time off is unpaid, though a casual loading may partly offset this for casual employees. Superannuation usually still applies. If you are paid mainly for your own labour, super is payable even if you have an ABN.



• Are travel and accommodation covered for locum work?
  

  For placements away from home, and particularly in rural and regional areas, travel and accommodation are commonly arranged and paid. This is part of what makes locum work mobile. Confirm the arrangements for each placement.



• What is credentialing, and how long does it take?
  

  Credentialing is how a health service verifies your qualifications, registration and background before you start. It is largely state-based and can take from a few weeks to a few months, so start early. Once you are credentialed with a service, returning for more shifts is much simpler.



• Can I tailor a permanent role to suit me?
  

  Often, yes. A permanent role negotiated well, frequently with a recruiter advocating for you, can be shaped around your preferred days, hours, caseload or development support. A locum placement gives you control over when you work, but on site you work within the hospital’s existing parameters.



• How do I choose between locum and permanent work?
  

  Set your income and stability floors first. If both models clear them, the decision comes down to fit: flexibility, variety, development, travel and what suits your life now. The right answer often changes with your stage of career.

Information Sources

• Fair Work Ombudsman, Casual employees
• Australian Taxation Office, Difference between employees and independent contractors
• Australian Taxation Office, Super for independent contractors
• AHPRA, Professional indemnity insurance arrangements
• Australian Taxation Office, FBT-exempt organisations
• Jobs and Skills Australia, Health Care and Social Assistance industry profile
• Gorilla Jobs, Why Is Credentialing So Important for Locum Doctors in Australia?
• Gorilla Jobs, The Cost of a Better Offer
• Gorilla Jobs, How to Choose Between Two Offers