How do you then handle negotiations? Contracting rates are often a lot (2x-5x) higher than fulltime employment. Do you do the contracting on a really low (contracting) rate, or do you succeed in explaining they will go down 3x in salary once they get the 'real' job?
Generally people understand that contracting rates aren't applicable to full-time employment. Primarily because their time isn't 100% booked as a freelancer.