To employ or contract? Research burnout

[clorox ribbon]

So, my "offer" to another therapist to come work with me has been accepted. (Yay!) She is just as happy to be an IC as employed, and I have been on this dang computer researching my brains out to be in compliance with an IC, or find out what is involved in employing.

Hopefully someone can clear up some murky parts. Here are the issues:

Employee:

I have no idea what worker's comp costs for my industry and can't find the information. I've called a couple of companies, but they only offer WC to larger businesses where the yearly premium is a minimum of $2500. Oregon requires WC even if you only have 1 employee.

Employing will also mess with my own business premiums, and I will be required to pay/carry liability in the event that my employee does not renew with the pro association (she is with AMTA.) The spa where she currently works (employee) does require her to purchase and maintain her own liability policy, so she is currently covered.

IC:
I am mostly in compliance with Oregon law with what I am currently offering. Equipment is already installed in rooms and the basics will remain even after my renter moves out. But she will provide any extra stuff she wants, (such as small equipment, tools, warmers, etc.)

I want to designate days when clients/schedule will be provided. F/I, this is a contract for work performed on Monday and Tuesday, and may expand if she wants to add additional days. Oregon law makes it sound as if she has the absolute right to work any day she wants, which doesn't make any sense to me if the room is already occupied, or no clients will be provided on that day. Am I still in compliance?

I would like to require that she only use certain types of oil or lotion (actually more of an exclusion of certain types,) is this a violation of Contractor status?

My clinic sets the end fee to the customer, and we have an agreed upon fee schedule to her. Oregon law says the contractor sets their own fees. What fees? And if she accepted based on the fees I suggested, who set the fees? If she adds a service to our menu that I didn't previously provide, she can set the client fee for that, for instance: outcalls, or hot stone therapy. And she can tell me what she wants for those sessions, for which I can say yes or no, right?

I would like to supply an initial stock of appropriate (meaning matching my clinic) sheets, towels, cradle covers, etc. (She will be responsible for all laundering/prep of her linens. She can't take them with her when she leaves the contract.) I would also like to supply an initial stock of organic oils and lotions. She may purchase more at my cost as she needs them. Is this going to mess up the contractor status?

Ack. This is not easy guys. :shock: It's supposed to be easy. I just don't want to get hit with some kind of bill 2 years down the road.

 

[Uh-Oh!]

To get you started, check out this website for info on what you need in order to hire an employee.

http://www.gaebler.com/Hiring-My-First-Employee.htm

 

[Michael T]

How about setting up a sublease contract, instead of an IC contract? Here's a quote by R&R about leases from another thread:
http://www.massageplanet.com/forum/viewtopic.php?t=8350

The contract you need is a lease, even if you are within someone's premises.

We rent a space in a local commercial development for our spa. The landlord has very strict guidelines of our hours of operation. Don't adhere to them, and you are fined. No different than requiring the nail tech renting the station to be their 6 days a week.

As for working on a commission basis, that does not necessarily change the fact that you are a lessee. Our landlord requires us to pay a monthly minimum rent, then we pay X% on every dollar of sales over Y.

Your decor can be made subject to landlord approval. We had to have all of our "improvements" some of which are considered decor, to be approved by the landlord.

You should be in control of your scheduling restrictions - like no back to backs - but that is not the same as setting your own hours.

Again, your "lease" can stipulate what you will "sell" and what you cannot sell.

 

[Big Bear]

Here's some information on independent contractors for state of Oregon. You might have seen it already.

http://www.boli.state.or.us/BOLI/TA/T_FAQ_Taindocon.shtml

It sounds as though Bliss has the best idea.

 

[Elijah]

How about setting up a sublease contract, instead of an IC contract?

Because I don't want her to lease from me, I already have that arrangement. I don't want to field calls then refer away from my business. Plus, she already has an arrangement where she can work as much as she wants from space she has access to. There's no incentive for her to lease from me, even at a minimum.

Thanks Kathryn, the first link was really helpful. I already saw the other link early in my digging for info.

I know that in construction, you can say to a sub: What's your bid for this roofing and fencing job?
sub: $x, you pull the permits. $x I pull the permits.
Contractor: The work needs to be done on these days. X, X, X
sub: yeah we can do that
Contractor: The job requires cedar shakes, and vinyl fencing.
sub: we can do that too.
Contractor: it's MY sign in the yard, I want you to do this as my representative, and you can't solicit business from the neighbors on your own while you're contracted to me.
sub: okay we can do that.
contractor: I accept (or I decline)

So, the contractor set the terms of the job, the sub made a bid commensurate with the terms of the job and the contractor, and agrees to comply with marketing and product terms. He's still a subcontractor, no question. He carries his own insurance and business license. But the Contractor "set" the terms of contract, simply by not accepting the contract if the terms aren't met. Right? Or am I totally wrong, and the Contractor is really employing, and subject to fines?

 

[animegal_cute]

By providing the basic equipment you are already in violation of Oregon regulations for ICs. Your way around this is to charge and equipment rental fee for every service but you must leave the option for the IC to provide their own and be paid more. The idea being they would never do that due to the hassle factor.

Consult a labor attorney to draft your agreement if you do that route. The rules are very vague and do not address every possible industry out there. It is not possible for an MT to do the work when and where they please.

Your atty should be able to draft something that is akin to a retainer agreement - you make yourself available M & T and I pay you the greater of x vs. work done

In any case, you should either go the Lease or Employee route.

WC insurance may not be too expensive - all depends on how whacked our OR laws are. CA runs about 5%, WA, about 1.5%

http://www.oregon.gov/DCBS/SBO/how_to.shtml will give you access to the state-funded system, the insurer of last resort.

 

[Aja]

I know that in construction, you can say to a sub: What's your bid for this roofing and fencing job?
sub: $x, you pull the permits. $x I pull the permits.

That is akin to charging a fee for booking appointments, doing laundry or other admin tasks related to the work, but not the work itself.

Contractor: The work needs to be done on these days. X, X, X
sub: yeah we can do that

Yes, but the contractor can do it all in one day, work only nights, etc. I think this is less of a problem since "control of schedule" can be industry specific. A contracted home health provider cannot decide when to stop by to administer meds, for instance.

Contractor: The job requires cedar shakes, and vinyl fencing.
sub: we can do that too.

And and architect can ever prescribe a specific color or brand. So you contract has to be to perform certain services using certain products -- to be provided by the contractor, or for the contractor for a fee.

Contractor: it's MY sign in the yard, I want you to do this as my representative, and you can't solicit business from the neighbors on your own while you're contracted to me.
sub: okay we can do that.
contractor: I accept (or I decline).

So long as the sub has their own independent business elsewhere available to the public, then you are on solid ground.

So, the contractor set the terms of the job, the sub made a bid commensurate with the terms of the job and the contractor, and agrees to comply with marketing and product terms. He's still a subcontractor, no question. He carries his own insurance and business license. But the Contractor "set" the terms of contract, simply by not accepting the contract if the terms aren't met. Right? Or am I totally wrong, and the Contractor is really employing, and subject to fines?

You need your IC to "bid" on staffing the room to perform the menu of treatments using the prescribed products.

Again, industry differences have to be interpreted in light of the vague rules. A GC may use a sub over and over again, and probably never use anyone else in that line of business. But since they do project work, it can be argued the relationship is not on-going. It ends after each project. Not quite the same as having someone come to your place on an on-going, regularly scheduled basis.

A clever attorney can word your contract accordingly, since the work is not always going to be at the exact same time every day with the same client.

 

[Erik Star]

Thank you, R&R. I guess the first order of business is to find out about WC, if it is reasonable, then I will save myself a lot of anxiety by simply employing. The MT is amenable to that status, so it seems it may be the better route.

Honestly, I would prefer to employ, rather than have her as an IC, since if she is an employee I can specify other tasks for her, and even pay her for occasional clerical work at my discretion, as well as have her do the post office runs, which I seem to never have time for.

I'm embarrassed to admit that I don't have an attorney, and have no idea how to go about finding one, but if I bring her in as an IC, I will definitely have the contract drafted by a professional.

 

[robin.mckay80]

findlaw.com is a good place to start.

Look for labor lawyers who specialize in representing management.

Even an employee who is paid 100% commission can be required to do certain admin tasks as part of that compensation, so long as it is spelled out in the terms of employment.