If a person or group contracts out of a system or scheme, they formally say that they do not want to take part in it. Employees can contract out of their employer's occupational pension scheme. a free deal which automatically converts into a pay as-you-go service unless you contract out
If a company contracts out work, they employ other companies to do it. Firms can contract out work to one another When Barclays Bank contracted out its cleaning, the new company was cheaper. the trend of contracting services out rather than performing them in-house