Private Military Contractor Pay Vs. Military Pay

Private Military Contractor Pay Vs. Military Pay

Is it true that private military contractors make a whole lot more money in places like Iraq and Afghanistan than regular army soldiers? Anyone who has ever worked as an independent contractor as opposed to an employee knows that the answer is both “yes” and “no.”

Reliable and detailed statistics are hard to find, mostly because many private military contractors work for the CIA and all aspects of their agreements are confidential. Nevertheless, most contractors earn between $300 and $750 a day, or between $9,000 and $22,500 per month. Some or most of this money may be “tax free,” as the IRS foreign earned income exclusion is $104,100 a year for 2018. As the name implies, contractors work on a contract basis. When the client’s need ends, so does their deployment and so does their compensation. That goes both ways, as generally, contractors can leave at any time without suffering any negative consequences.

Whereas contractors receive the same compensation regardless of experience, regular servicemembers are paid according to rank. In most cases, privates earn $1,468 a month, captains earn $4,952 a month, and all other combat soldiers fall somewhere in between. The tradeoff is that soldiers are full-time employees. When their deployment ends, the paychecks keep coming in the same amount. Furthermore, as any military recruiter will happily confirm, servicemembers have access to long-term medical, retirement, educational, and other benefits. The downside here is that soldiers must remain at their posts until relieved or discharged, no matter what.

Given the significant pros and cons in terms of compensation, no one can really question your decision to either stay in the Army or become a private contractor.


Although the terms are sometimes used interchangeably, there is a significant difference between “mercenaries” and “contractors.” The former are almost always used in offensive operations. During the Revolutionary War, the British used German (Hessian) soldiers to supplement their ground forces in offensive operations against the rebellious colonies. The Battle of Trenton, made famous as Washington crossing the Delaware, was against Hessian troops. The Hessians were also mercenaries in the sense that they had no interest in the conflict between Britain and its colonies. Furthermore, since almost none of them spoke English or could locate America on a map, they had no knowledge or appreciation of the issues involved. Instead, they only wanted money.

Although they do receive higher compensation than regular servicemembers, military contractors are different in almost all other respects. Because it is illegal for the U.S. government to use mercenaries for offensive purposes under the Anti-Pinkerton Act, and because the private military contractors in Iraq and Afghanistan are not just fighting for the highest bidder (contractors in Afghanistan would not fight for the Taliban if offered a few dollars more), the U.S. has never signed the United Nations Mercenary Convention. China, Russia, and several other nations with large militaries have not signed either.

Private military contractors also do not meet the UN definition of mercenaries because, for the most part, they are either U.S. nationals or foreign residents of territory under U.S. control. Legally, mercenaries must be completely detached from the conflict in an emotional sense.

Eligibility for Injury Compensation Benefits

If the conflicts in Afghanistan and Iraq were like World War II, which was a conflict between formal military organizations, contractors would not bear as much of the risk as servicemembers because they would spend most or all of their time in the “rear area.” But in an insurgency, there is no rear area. A security detail escorting a VIP on an inspection tour is just as likely to see action as a designated combat formation.

So, both contractors and servicemembers need an injury compensation system. Servicemembers can rely on the Veterans Administration, and contractors can rely on the Defense Base Act. Under this 1941 federal workers’ compensation program, injured contractors are entitled to both lost wages and medical benefits.

Private military contractors, whether citizens or noncitizens, who work for the DoD or any other government arm and are injured in a foreign war zone, either as the result of an accident or by enemy activity, are eligible for DBA protection. A “war zone” is essentially any place that has a U.S. military installation, whether or not bullets are flying. In some cases, contractors who work for a sympathetic foreign government may also be eligible.

Furthermore, the United States Supreme Court has declared that DBA victims need only prove a nexus between their injuries and their reason for being overseas. So, if a suicide bomber attacks an area where contractors spend their off hours, contractors injured in that incident are probably eligible for compensation.

Contact Barnett, Lerner, Karsen & Frankel, PA today to learn more details about the benefits available.