I work in IT. To me, a contractor gets paid a (usually huge) day rate, which compensates for no sick pay, no holiday pay, no pension. Some of them are brilliant and worth every penny, and some are blagging shysters who are really crap. I thought that for a lot of contractors, for the employer, it's not a huge difference from paying a permit, as the higher rate isn't so different from paying salary plus pension, tax, NI, etc. They don't usually have annual goals etc, but there is mostly a line manager to coordinate tasks/whatever they're meant to achieve, because they're almost never working in isolation, but as part of a team, on a project.
TBH, I've never usually known who is a contractor or not until they're the first to be let go (no redundancy- and one who was sacked didn't have to go through the full HR process.)
Fixed term contracts aren't the same.
If I were working as maternity cover, I'd probably want yo let people know, maybe "maternity cover for Jo Smith" on my email signature, which explains why I'm there, why it's temporary, but days nothing about whether I've been seconded from another department, a temp from an agency, a fixed term contract employee, or contractor on ££££.