Another employee vs IC question...

wraseOrierFaf

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I wanted to address this question to everyone however Healthytouch and Happyhands made me think of it from their comments in the Spa section.How do you as business owners set up when you are just starting out with another therapist, and aesthetician when you own the building and are a therapist as well?  Do you ask for a % such as 60/40, do you pay an hourly rate?  Do you provide oils, sheets, laundry and advertising? I realize there is criteria for IRS and employees.I am wondering how you figure all this out.  I get a headache when I try to piece all these pieces together.  Thank you for the info in advance.LeContefairy
 
I think the biggest decision to make here is whether you, as the owner, feel you can financially support an employee (paying taxes and such) -vs- whether you want someone who will just pay you rent for the space -vs- a contract employee who you pay "X" amount of money for "X" amount of work.  Unfortunately, each situation has both its drawbacks and plusses.A perceneforum.xxxe split can be difficult if it is a new business because then you as the owner are relying on someone to actively go out and build their business so your perceneforum.xxxe will steadily increase.I tend to lean more towards a fixed rent plus a perceneforum.xxxe of profits on a sliding scale as a doable solution to this type of situation.
 
Thank you Intuitouch,Could you explain more about the fixed rent with perceneforum.xxxe of profits on a sliding scale.   In setting up this way could I still use my business name and brochures and include the other therapist and aesthetician and their modalities, etc.?  Does the cost of brochures come out of the rent/perceneforum.xxxe?  I am guessing it does.  Thank you for the info.  I think I would like to tiptoe into this adventure by starting out with what you have described and then as it grows pay taxes etc. for employees.    LeContefairy
 
I will try my best to describe a fixed rent with a perceneforum.xxxe on a sliding scale.  :)Let's say you are thinking of charging them $400/month straight rent.  However, they are new and don't have much of a clientele and can't afford $400/month.But they could afford $275/month fixed rent plus 30% of their income.The sliding scale kicks in when the rent figure of $400/month is met.  Once you have received $400 the 30% would then drop to a lower perceneforum.xxxe which is applied to the remaining income for the rest of the month.How this would look:They would pay you $275 at the beginning of each month plus 30% from each session they do.If they charge $50/session they would pay you $15 from each session until they have paid you the additional $125 which brings their full rent paid to $400.  After that figure is met, they would then pay you a lesser percent on anything additional they make that month.  Let's say by the third week they've paid the $400 rent payment.  Then they do 6 more sessions at $50/session till the end of the month arrives.  The sliding scale would kick in and they would then pay you the agreed upon lesser percent -- lets say 20% on those last six sessions -- which would give you an extra $60.Then at the beginning of the month it starts all over again -- they pay you $275 and 30% till they reach $400.  Then 20% on their remaining income till the end of the month.As far as expenses go I see those as negotiable points between you and the renter.  Let me know if I confused you more than I helped. ;)
 
I think that was a great explanation AND a great idea. I have only ICs working with me, including my Receptionist. One gal (Esthetician) rents a room. That's best for her with all her equipment and retail items. She pays $600 a month. Another practitioner (Permanent Cosmetics Artist) found me (the only plus side to my glossy city magazine ad!), and offered to pay me 40% of her take/30% if things are on 'special' or during special promotions. A third rents on a per usage fee. The fee is lower than the average other's here have listed (other threads), but contingent upon a pow-wow after 3 months time. She currently kicks back $5 per class, $10 per one hour tx, $15 for longer sessions. I want it to be $10/$15/$20, especially as all of her clients so far have been personal referrals from those of us working there (no new clients from that vein as yet!).Yes, there are drawbacks and plusses to each scenario. But I am happy with the community of servers we have at our place. Originally, I thought to have each room going straight rental, but it doesn't always pan out that way. They each negotiated their own deals, and I am happy, as are they.It is not written in an agreement or anything, but I do take on the responsibility of advertising the whole place. I list everyone in my website. I list everyone & highlight their special offers in e:newsletters and other e:campaigns sent out regularly. Recently I purchased an expensive ad campaign in a local/regional yellow book, then everyone happily chipped in for the next one- a direct mail postcard campaign.I am now looking for an MT (probably someone newly relocated here or a newly licensed individual) to share my personal room to do evenings & weekends. I am offering a fully furnished, beautiful space (they would bring their own linens & medium) & all perks & plusses others enjoy (reception, visa, etc) for $350 a month or a sliding perceneforum.xxxe. My idea of that would be 40% if they do 1-5 txs a week/30% for 6-10/20% for 11 or more. Paid weekly. After reading the last explanation of a sliding scale, I have another idea of a way to work it out.Ideally, I would love to have each room rented, but sometimes being flexible works well too.  I never want to do a payroll or taxes, etc. I have enough on my plate doing mine!Jill/sagetherapist
 
Another employee vs IC question...

Sorry I didn't reply... To your question....I only charge booth rent. Yes I could be getting a % of their income. But.... I am to busy to sit down and figure every week, and I don't want to deal with the supplies,etc..... Now Iam a small very small business. Maybe when it grows more I'll change as I hire more staff. But for now, All I worry about is the booth rent being pay on time at the beginning of the week for that week. You see I work in a bigger spa that we paid $150.00 a week or 30% of our income which ever was the most and believe me the 30% was always more for me any way. And I had to clean answer the phones( I was marked off the books for 2hrs a day) and I didn't think as much as I paid her I should have to so all that. So when I opened up my own place I said it is mine You pay weekly and if your here your here and if not anyone that walks in the front door is mine, If your here or answer the phone and its your turn they are yours. But if you leave and the caller or walkin doesnt ask for you they aremine. Fair is Fair.Guess what every one comes in and opens and stays and closes (unless they have choosen to take the day off). My girls all get along and work well together and we all sell each other.Oh their booth rent is $75.00 a week. I hope that answered your question.And no, No contracts.BOOOOO!!!
 
Thank you thank you thank you, I have printed this page off.  I think the rent plus a perceneforum.xxxe on a sliding scale could work really well for what I would like to do at the hotel spa I work out of. A "community of servers" (that's great Jill/Sagetherapist).I really appreciate you all helping to clear this up for me.  I have all kinds of ideas popping in my head now!LeContefairy
 
Jill/Sagetherapist, You wrote that your receptionist is an IC.  Does she just bill you for her time.  Could you give more detail please?  Sorry for all the nosey questions.(If I knew how to activate the smileys I would place one here)* thanks.LeContefairy
 
Another employee vs IC question...

She choses her hours, we worked out the job description together. I pay her X per hour. She logs the hours & gives me the log to sign & pay out on the 1st & 15th. She basically manages the flow for all of us at the studios. I can only afford so many hours per week right now, but hope in the fall I can increase her hours. She will (again) tell us when & which days, etc. So far its each day, covered evenly. She & I have known each other for a long time, even worked together before at the 'titanic' salon. There's alot of trust.Jill/sagetherapist
 
Another employee vs IC question...

Employee vs. IC is not so much cost as it is burden and risk.You will find that for the person in question, their net pay is more or less the same at the end of the year.As an IC, you are probably paid more, but you have to pay the full load of Soc. Sec. Tax (13+%) and self employed tax (another way of charging state and federal unemployment tax the employer would pay).As an employer, you would take on the burden of tracking and paying all the associated taxes of an employee. The scary part is the risk. If you do not pay your federal taxes each month by the 15th, you pay a 20% penalty. More than a month late, hello interest at a whopping 1.5% per month.That can add up, because it is assessed on the ENTIRE amount due (your taxes due as well as any emps.) not just on the part you did not pay (dollar short? too bad, pay uncle sam 20% penalty on the other 99% you did pay - go ahead, I dare anyone to say our country is under taxed!)Most spas go with ICs because it is easier.
 
Another employee vs IC question...

Uncle Sam scares me!!!I think IC is the way to go especially as small an operation as I would have and much much easier as far as paperwork and expense.Thank you Jill/Sagetherapist, it sounds like you have a wonderful group surrounding you!!!This information has helped me, now I don't have a headache from overthinking how to do this.  Thank all of you so much.LeContefairy
 
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  38. AliceSpa:
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  41. HolidaySpa:
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  42. SugarLoveSpa:
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  43. bnwellness_wilson:
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