Lots of good input, I appreciate it guys. I've been following along and reading.
Why are you against employees of I may ask?
I'm not
against employees, I just don't want them. There are a lot of reasons why, being self employed I don't have to deal with MOST of the headaches I would if I had employees. My shop setup isn't conducive to employees, my cash flow isn't conducive to having employees, unless they are temps or part time, my WORK isn't conducive to employees
I have a customer that is a 3rd party sales person. They bring me stuff that no one else will touch. The
weird stuff. A part print from 60 years ago with a material noone has heard of, a DIN standard that takes an hour to find that is an esoteric abomination for a particular process from an industry that doesn't seem to exist anymore. So my machine shop stuff, I need to focus on, because finding help doing that will be expensive, and rightly so! It's everything else that takes so much time!
Depending on how much of it you have is it possible to just hire someone through a temp agency? Since they are an employee of the agency the government would not have a problem with that and you would be able to audition a possible employee of the future.
I've considered this, but I think I want to search for contractors first, people with established business's who are at least good enough at what they do to keep a business going! Of course, that may not be possible for some of it...
"What is the line between an employee and a contractor? A contractor can do everything but make your physical product?"
It is my understanding if someone works at your place using your stuff they are an employee, though there are folks calling them contractors all over every day. I think if they don't pay their taxes or get injured you will get the bill and fines.
The injured aspect is something I worry about...
Second that. Work out a deal with an employment agency. They can manage your employee as their own. It will cost you but less than the risk involved in an employee if you are thoroughly against growing your company much larger than a couple person operation.
Lot's of employment agencies around here.
Careful with your recommendations though
If I decide to grow my company to the point I need extra help, if I hire employees I won't need that Flex unit
There are as many definitions for independent contractors as there are work settings.
In the world of workers compensation with which I'm familiar, there are general rules. It makes a big difference, since when a worker is injured on the job, if he or she is an independent contractor, then their injury would not be compensated under the employer's workers compensation policy.
In general,
1. The worker is licensed and has a company name. .
2. The worker advertises in the Yellow pages and/or, modernly has a website
3. Has his/her own tools.
4. Sets his/her own hours.
5. Is paid by the job.and has a contract for each job.
Other agencies such as the federal government may have more of less the same rules but generally will be different from the workers compensation rules.
Just recently in the California election this issue came up with regard to Uber and Lyft drivers on their Proposition 22. A yes vote meant that such drivers whose work was based on Cell Phone Apps and had their own vehicles could remain as independent contractors. The proposition passed mainly because if the drivers wee to be classified as employees, the industry would be shut down and many people who have no cars depend upon them heavily.
So, who is an independent contractor? It all depends.
Thanks for that post, very informative!
Pretty much this ^^^^^^^^
I will add one though:
6. The worker must have a bank account with the business name.
This is because you can not legally 1099 them for any form of payment made out to anything other than their business name.
Interesting, I have worked both ways as a contractor, but as the following comments point out, that may be state by state?
What are you trying to circumvent by hiring a contractor and what do you look to gain or just basically eliminate?
I spent a lot of time in November and December thinking about the upcoming year. I feel like in the last 3 months I have been in a quagmire. I am months behind on projects, and over a month behind on a couple customer deliveries (not the end of the world for me). I come into work, and I feel like I spend all day chasing my tail. I spent probably close to 10-15 hrs in September and October making phone calls, getting quotes, meeting and explaining my business to insurance people.
COVID has contributed to a lot of it, a silly example. One of my steel supplier put my salesman on furlough, and hired a third part sales person. She does a good job, but is not on site. Over a month ago I ordered a 12ft bar of 1" A2 for a project, I bet we have half a dozen phone calls and 3 or 4 emails now, and I still don't have my bar of material. I got all the other bars in the delivery... and a subsequent order.... and a subsequent order....
I've read about many guys who were in a similar situation, one man shop, who just can't seem to do everything. And so that is what makes me look to hiring out some work. I've already started to find shops to handle some of my product work. I grew up doing everything myself, I simply did not have the money to pay people to do the work for me. Now I think I need to stop doing everything and start hiring it out to contractors.
The conundrum comes, do I try to find part time help to keep the spindle running so I can be an office manager/maintenance/etc, or do I keep the spindle running and try to find some part time help to be office manager/maintenance/etc.
And before someone broaches the subject
Yes, I could work harder.
I used to regularly work 70+hr weeks at my day job AND worked another 10-20hrs at home at my hobby business. My wife fired me from that job 4 years ago and told me to work from home and grow my business. The short of it, I was not a nice person to be around when I was working those hours.