If you've added contacts to your Synergy organisation who you only want active when you're working with them on a project/stage, you can mark them active/inactive as required. See example below:

We do work with contractors, and we would like to keep them in our system but flag them as active only when they do work with us. Is it possible?

You can add them as additional staff and deactivate them later when they have completed their projects.
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If they work with you again and are required to enter timesheets, you can always activate them from the Staff area as long as you do not delete their profile.

To reactivate a staff member In the staff area, click on the search icon near the 'Add' button and change the 3rd filter from 'Active' to 'All' and search.

To make them active again, select the box next to their name and go to the grey box at the bottom of the page. Open the drop-down and select 'Set as Active'.