Happy Cinco de Mayo everyone! Today we get a little technical talking about the difference between and independent contractor and employee and how the distinction between the two can affect your business. For more information on the topic click the following link:
https://sbshrs.adpinfo.com/blog/1099-vs-w-2-what-you-dont-know-could-cost-you?utm_campaign=Tip%20of%20the%20Week&utm_medium=email&_hsmi=124936785&_hsenc=p2ANqtz–f8mvv-TK5E5y0iaNUu54HllI4prLUW-6w2OXHPoKYmGiqKl8Nrsq52PCXw0kWPB9LpGvEJqbJ_vqSh6sQYYdxUYaH-3v9J6h4RboQcdfNGPwQRUw&utm_content=124936785&utm_source=hs_email
As always check out the website for more content www.bcbousa.com
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Full Recap:
Hello and welcome to BCBO daily. It is Wednesday, May 5th, and I am your host. Dan Murch. Happy Cinco de Mayo, everybody. Hope everybody has a good day ahead of themselves, and they have a chance to have a taco or a margarita or whatever tickles their fancy. Yesterday was a great day. Another stellar Tuesday, lots of activity, jam packed, lots of daily grind stuff.
I had an awesome conversation with one of our clients who is looking to take the time to really explore what they’re doing in their business, go over their job costing or over their P&L. You know, spend some time, once a month going over their big picture stuff.
And again, as I say all the time, that is the type of stuff that I absolutely love talking about. So that was great. It was a great conversation to have great to have them reach out. I was really excited to to do that. I’m looking forward to working with that client going forward. It should be a good experience for both of us. It’ll be a good experience for me. Hopefully it’s a good experience for them as well.
So as we jump into our Wednesday, we are just about halfway through the week. And today I wanted to go over a little bit of techincal information. Once again, Gina has come through and she found an awesome article, blog post, whatever you want to call it, that of details some basic information about employees versus independent contractors and what it can mean for running your business and what it can mean for you as the owner, if you don’t classify them correctly. So the blog post is actually fairly long and pretty detailed. So, I’m going to put a link to the post in the description of the podcast.
If anybody wants to go read it word for word, which I actually highly recommend, but just wanting to kind of give you the cliff notes version of what they’re talking about. So, anybody that’s either working right now as an independent contractor, or if you’re running a business and you have independent contractors working for you, this is an important conversation.
So, there’s benefits to having somebody from a cost perspective, classifying somebody as an independent contractor, as opposed to an employee, right? So, an employee, all the obvious ancillary expenses that come along with that, payroll taxes, workers comp, certain benefits that they’re entitled to like family medical leave act, certain equal opportunity, rights, all sorts of stuff that an employee in this country has rights to, which obviously they should.
So, independent contractor, you lose some of that. You’re basically, you’re a freelance employee. You go and you work for this person for a set amount of money, and then you get paid for it. And as the company, you’re not paying the payroll tax on it, you don’t have to cover them on your workers’ comp, you don’t cover them on your general liability. You should get an insurance from your independent contractors. So, what happens a lot right times is employers try to skirt around having somebody be an employee and instead of have them be an independent contractor to help their bottom line.
That is a dangerous thing to do because if you get audited and it gets found out, there can be some pretty serious consequences to it. So again, highly recommend you check out the article that I’m going to put a link in the podcast too. It’s very detailed, but I want to go over the cliff notes version, basic standard stuff that separates an employee from a 1099 contractor.
Does this person work solely for you? Would you label them as an independent contractor, but they work for you 40 hours a week and they don’t have the opportunity to go out and earn money other places. Then they’re not really an independent contractor. They’re an employee. Do they have the opportunity to quote pricing to you say, okay, I’ll do this job for X amount of dollars? Or do you say when you work for me, I’m going to pay you, you know, X amount per hour or X amount per day. And there’s no real relationship there back and forth. It’s more of you’re in control and this is what they do. That’s another way that they might end up being really an employee and not an independent contractor.
What are some other things? Some of it is kind of vague, which kind of makes it difficult, but a lot of it comes down to the relationship between you as the employer and the independent contractor, or if you’re listening to this and you are an independent contractor, making sure that you’re being classified properly, that you have some freedom.
You’re supposed to have some freedom as an independent contractor to go get work from other places to generate your own profit, or unfortunately sometimes generate your own loss and not be beholden to just one employer. If that is the case, if you’re locked in right now and you’re just working for one person and you can’t go work for anybody else, then chances are, you really should be classified as employee, and you’re missing out on some of the benefits that an employee in this country is entitled to. So that’s it. This is long article that I can go into it for long, long time, but I don’t think anybody really wants to listen to that. So, I’m going to post the link into the description. I highly recommend everybody check it out.
It kind of just goes into everything that we talk about, about running your company the right way. You want to make sure you’re doing things proper. You want to make sure you’re doing things above board. It all, it is all intertwined. So that’s what we always talk about. It all intertwines, you hire good employees, pay them on time. You pay them fairly. You work with good subcontractors. You have your insurance; you’re running your finances. All of those things, they all add up. And the more above board and more cleanly you are running your company; you’re going to attract good employees. You’re going to attract good subcontractors and you don’t have as many headaches, you know, when you kind of just doing things fly by night. Again, those are the types of people that you attract to you and the types of work that you do and the type of customers you get and all sorts of headaches that come with it. So, this all ties into it. So, just wanted to give you guys a little bit of technical information and I hope it helps you.
So that’s it for today’s nugget of information. So, let’s do it guys. Let’s jump into our Wednesday. We are, again, almost halfway through our week. Let’s go out, let’s pay the rent on our success. Let’s keep moving ourselves forward. Let’s keep asking ourselves that question. How would the personI want to be handle the thing I’m about to do?
Let’s keep pulling ourselves towards our goals. Keep putting ourselves in that forward thinking mindset and keep working towards the future. Spend a little bit of time working on your big picture things today if you can. I got to spend a little bit more time doing it yesterday, which was great. So that’s already, you know, two days down and got to spend both days again, only like 20, 25 minutes each day but it was energizing. It feels like I’m not getting consumed by the daily day to day. And it really helps. And I also feel like I’m working towards my future, so that’s all good stuff. So, if you have the opportunity today, please do so.
Just like every other day, it happened yesterday, gonna happen today, even though it’s Cinco to mile it, doesn’t take it off just because it’s holiday. Things aren’t going to go as planned a hundred percent of the time. So. Let’s be kind to ourselves. Let’s try to limit any negative self-talk that we have throughout the day. And at the end of the day, let’s sit down. Go over everything that happened, make adjustments where we need to, but remind ourselves of the things that went right. Celebrate our successes. We’re working hard. We’re doing good things. We deserve to be happy. We deserve the success in our life. So, let’s enjoy it. Let’s recognize ourselves for it and let’s enjoy it.
And lastly, as always check out the website, bcbousa.com. That’s where you can get more of the good good.
That’s it guys. Let’s go out and have a great Wednesday. Tomorrow’s Thursday, my favorite work day of the week, as you all know, so let’s go have a great one and we’ll talk tomorrow. Thank you for your time. Have a great day. Bye.