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Drivers, Employee's & Some Basics


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#1 AkaReaper

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Posted 31 August 2008 - 04:27 AM

Ok, before you send me nasty grams or anything I just want to say that I really do not care how you pay your employees, drivers, hired help, or whatever you call them. People will do what they want to do regardless. Just like unlicensed panels, units, etc., I suggest, but I don't care if you have them or not. I'm not the Moonwalk Police.

But, we always seem to get a lot of questions about drivers and hired help. So, I wanted to list some basics that you should know.

1. You can not pay them as independent contractors. The IRS does not recognize this in our industry. This has been seen first hand by myself, Edjewcollins, magicguy and many many others. So, just be prepared to pay the piper if you get caught. Upset employees who are fired may just dime you out.

2. Unemployment insurance. This varies from state to state, however in Michigan you must pay unemployment insurance. They do not consider it a seasonal business. That sucks, but thats their ruling. Check with your state. Better to pay now than later.

3. Workmans Compensation Insurance. Again, this is federally recognized so make sure you have something in place. Certain family members are exempt but if there is no relationship you must carry it. Watch your contracts with schools, churches etc. They may require it and can sue you for damages if your employee sues them for getting hurt on the job while on their property. Nice huh?

4. Taxes. Gotta pay them. Social security, state, federal, make it easy, use a pay check service if you must. No way around this. No, you can't 1099 them, remeber tip #1.

5. Car insurance. If they are using their own vehicle for work, you can still be held liable for any accident they incurr while working for you. Check to make sure your/their insurance will cover these mishaps. Its a wise idea to place commercial coverage on your vehicle and have them drive a company vehicle. Also make sure they have clean driving records. An insurance may cover an accident form someone not listed on the policy as a driver, but come renewal time they might not be so forgiving.

6. Overtime. Again, the NLRB, National Labor Relations Board will hammer you if you do not abide by overtime compensation rules. If you do not have a union contract or workers contract outlining overtime payment you are asking for trouble. Some states require anything over 8 hours in a day to be paid at an overtime rate, and some require it be paid for any time over 40 hours in a work week. You could try to consider them salary, but if they run to Uncle Sam you will probably lose.
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#2 poposparties

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Posted 31 August 2008 - 06:52 AM

Matt,

Nice post! A lot of good, concise information. Like you, we learned the hard way years ago. I cannot stress the point enough that our hired help are not independent contractors! I'm just wondering what brought your post on?!? There sounds like a tinge of frustration in it.

POPO
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#3 AkaReaper

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Posted 31 August 2008 - 08:47 AM

Just wanna put the info out there.

#4 Sabrinas Party Rentals

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Posted 31 August 2008 - 05:19 PM

Well done, I would comment on employee classifications but I don't know mutch about it!

#5 justjumpn

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Posted 20 January 2009 - 11:37 AM

Does anyone have an idea of whom they can recommend who prints business card magnets at a reasonable price? :yahoo:
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#6 ISS

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Posted 01 February 2009 - 04:23 AM

Matt, thanks for the post. I am relatively new to the business, and have one employee (who is my business operations manager), and several part time contractors who are drivers. Last year I really wanted to make my delivery staff employees, had them fill out all the paperwork, and then proceeded to obtain workers comp insurance. My insurance agent had a hard time finding the classification of my inflatable rental delivery crew, but came back with a quote essentially around 10% of my total revenue! I was blown away, and there was no way I could afford that. The closest classification he could come up with for the workers comp was something like tent delivery. I live in FL, but since workers comp utilizes federal codes, can anyone share what workers comp code their employees are classified as? Also, what % of revenue are you paying for workers comp? Thanks in advance for your help!

#7 Ameenah

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Posted 07 February 2009 - 03:44 AM

Thanks Reaper for posting
How do you guys find help I ma going craiglist add and what % of the job do you pay the person

quote name='poposparties' date='Aug 31 2008, 06:52 AM' post='48381']
Matt,

Nice post! A lot of good, concise information. Like you, we learned the hard way years ago. I cannot stress the point enough that our hired help are not independent contractors! I'm just wondering what brought your post on?!? There sounds like a tinge of frustration in it.

POPO
[/quote]

#8 Sabrinas Party Rentals

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Posted 08 April 2009 - 05:56 PM

Matt, thanks for the post. I am relatively new to the business, and have one employee (who is my business operations manager), and several part time contractors who are drivers. Last year I really wanted to make my delivery staff employees, had them fill out all the paperwork, and then proceeded to obtain workers comp insurance. My insurance agent had a hard time finding the classification of my inflatable rental delivery crew, but came back with a quote essentially around 10% of my total revenue! I was blown away, and there was no way I could afford that. The closest classification he could come up with for the workers comp was something like tent delivery. I live in FL, but since workers comp utilizes federal codes, can anyone share what workers comp code their employees are classified as? Also, what % of revenue are you paying for workers comp? Thanks in advance for your help!


Call Sandi Swift at Friedman Group 877-580-7066

She wrote our inflatbles and DJ liabiblity polocies and she did our workmans comp.

BTW Work Comp should be based off the payrole not the sales!

#9 SuperFunGal

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Posted 21 February 2010 - 05:33 PM

Great Post! I think you did a great job explaining some of the really controversial topics among operators in our Industry. I agree completely and it is so much better to be well educated than to take chances on what you think sounds right. When you have local or federal agencies calling you for answers, I would always prefer to have the right answers. :rolleyes: Thanks for the Information!
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#10 SuperFunGal

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Posted 21 February 2010 - 05:36 PM

Matt, thanks for the post. I am relatively new to the business, and have one employee (who is my business operations manager), and several part time contractors who are drivers. Last year I really wanted to make my delivery staff employees, had them fill out all the paperwork, and then proceeded to obtain workers comp insurance. My insurance agent had a hard time finding the classification of my inflatable rental delivery crew, but came back with a quote essentially around 10% of my total revenue! I was blown away, and there was no way I could afford that. The closest classification he could come up with for the workers comp was something like tent delivery. I live in FL, but since workers comp utilizes federal codes, can anyone share what workers comp code their employees are classified as? Also, what % of revenue are you paying for workers comp? Thanks in advance for your help!



As far as a good workman's comp code - Class: 901605, RT: EM, Description: Amusement Parks is what I use.

This covers delivery drivers, warehouse, event staff, setup and tear-down crews and I found a very reasonable rate through my local Chamber of Commerce. Sometimes I think just knowing the right code helps. I got several quotes from different places and they all picked a different code for me because it was something they have never seen before. I finally found an agent that asked the right questions to find the answers. This industry is so unique that it is hard to always find people on your professional team (CPA, Attorneys, Insurance of all kinds).

I also have coverage separate for my office team, but that is an easy to find category. :rolleyes:

Hope that helps!
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#11 B N

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Posted 23 February 2010 - 07:49 AM

I was ready to sign my guys up as IC's till I posted here. Reaper is 100% correct they cannot be subs. The rest of that info is great also.
I need to check the code my comp guy used my quote was for $6.05 per $100 paid. So a touch over 6% with this new code from super fun girl I will now make some phone calls. Thanks for the info.

#12 natej

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Posted 23 February 2010 - 07:54 AM

I was ready to sign my guys up as IC's till I posted here. Reaper is 100% correct they cannot be subs. The rest of that info is great also.
I need to check the code my comp guy used my quote was for $6.05 per $100 paid. So a touch over 6% with this new code from super fun girl I will now make some phone calls. Thanks for the info.

Ours is at about 3.5%...

#13 rjump

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Posted 23 February 2010 - 08:42 AM

We are in the process of changing our employees pay rate from by the job/unit plus mileage to hourly. We paid out WAY too much in employee costs to our guys last year.

I just finished a 2 hour QB lesson from my bookkeeper so I can handle the paychecks bimonthly. I used to pay the guys once a month and had my bookkeeper handle the numbers. Since the guys are not salaried, legally I should have been paying them twice a month. She charged every time she did payroll, so I would have to pay her double to do it bimonthly. My head still hurts from the lesson and hopefully in a week I will remember everything. It does feel good that I have everything set up properly, including overtime.

Caroline

#14 natej

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Posted 23 February 2010 - 08:50 AM

We are in the process of changing our employees pay rate from by the job/unit plus mileage to hourly. We paid out WAY too much in employee costs to our guys last year.

I just finished a 2 hour QB lesson from my bookkeeper so I can handle the paychecks bimonthly. I used to pay the guys once a month and had my bookkeeper handle the numbers. Since the guys are not salaried, legally I should have been paying them twice a month. She charged every time she did payroll, so I would have to pay her double to do it bimonthly. My head still hurts from the lesson and hopefully in a week I will remember everything. It does feel good that I have everything set up properly, including overtime.

Caroline

I am contemplating switching to hourly as well. What was the tipping point for you? How many jobs does one guy have to do in order to make more sense to do hourly?

#15 rjump

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Posted 23 February 2010 - 01:54 PM

I am contemplating switching to hourly as well. What was the tipping point for you? How many jobs does one guy have to do in order to make more sense to do hourly?


I'm not sure exactly what you are asking, but when we initially set up the pay scale to pay them by the job plus mileage (if they were using their own truck), we thought that this would work better than hourly since we didn't have to worry how long it took them to set up/take down the units.

What is found out is that almost all units can easily be set up well within an hour, no employee so far is THAT slow, and if we charged a delivery fee because the customer was out of our normal area, we ended up loosing money on mileage since the driver had to go back and forth 4 times to one location. The less busy we were, the higher % we were paying out on employee costs.

So now we have two rates, one for drivers and one for helpers. No mileage paid out since they will be paid as soon as they show up and while they are driving. They will get overtime as well, which doesn't bother me since we will be super busy to cover the extra cost. We also have the option of spreading the schedule around as well to avoid this.

Does that answer your question?
Caroline
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#16 natej

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Posted 23 February 2010 - 01:57 PM

I am contemplating switching to hourly as well. What was the tipping point for you? How many jobs does one guy have to do in order to make more sense to do hourly?


I'm not sure exactly what you are asking, but when we initially set up the pay scale to pay them by the job plus mileage (if they were using their own truck), we thought that this would work better than hourly since we didn't have to worry how long it took them to set up/take down the units.

What is found out is that almost all units can easily be set up well within an hour, no employee so far is THAT slow, and if we charged a delivery fee because the customer was out of our normal area, we ended up loosing money on mileage since the driver had to go back and forth 4 times to one location. The less busy we were, the higher % we were paying out on employee costs.

So now we have two rates, one for drivers and one for helpers. No mileage paid out since they will be paid as soon as they show up and while they are driving. They will get overtime as well, which doesn't bother me since we will be super busy to cover the extra cost. We also have the option of spreading the schedule around as well to avoid this.

Does that answer your question?
Caroline

So if I understand you do not pay them for mileage in their own vehicle, but rather an hourly rate that covers their gas? Or do they drive your vehicle?

#17 Mickeyco Entertainment

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Posted 08 July 2010 - 04:16 PM

I only have one guy who started with me this past weekend. I'm paying him hourly, because he's just a helper. We're usually done by noon, and start back up at 6pm till 11pm.. all I all, I only had to pay him for 13 hours last weekend, because he did go home from noon till 6.

#18 Work-A-Holic

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Posted 14 December 2010 - 05:44 PM

Earlier this year I invested allot of time in a detailed 32 page Employee Handbook covering all aspects from holidays, time off, appearance, work attire, texting, online access, privacy policy and the list goes on and on. I started to think of this for several reasons after hearing that Disney was being sued for not making accommodations for a Muslim worker that refused to wear the company uniform. I found a template online and started with that. I got really frustrated after losing an unemployment case because one of my employees had an attendance problem and I fired him. The judge gave him full unemployment benefits because I didn’t have an employee handbook.

I also created an offer letter for potential new hires outlining the requirements and pay scale. Closing statement on the offer letter (I hereby accept employment on the conditions set forth in this letter. I understand that my employment with ABA is at-will and that this offer letter is not a contract)

Here is the response from the attorney that reviewed and changed it to protect us from future legal trouble and the cost for the attorney to review and change was about $350.00.

Chad –

Let me begin by saying this is the most comprehensive handbook I’ve ever seen. I’ve had huge companies put together handbooks 1/10th of this size. Very impressive.

Please find attached an offer letter, a marked version of the Manual and a clean version of the Manual.

The offer letter should be very simple, brief and concise. It can be used for all of your hires and tailored to their position, pay, etc. I’ve set this one up as a driver for $10 but should be used for everyone. You don’t need all of the requirement you currently have because most of those are driver-based requirements. Keep the offer letter short and sweet.

The Manual has been changed extensively. There is an emphasis on the at-will nature of the employment. I cleaned many of the sections dealing with harassment, discrimination, etc. I’ve also included a few pages on social media. It’s only going to get bigger and you need to be out in front of it. I think you’re pretty well covered now.
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#19 Scott Valentine

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Posted 27 January 2011 - 12:17 PM

Would anyone be willing to email me a copy of the handbooks that they use. I am trying to create one for my use but I could use some ideas. Thanks in advance.
Scott

#20 Fun Zone

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Posted 15 August 2011 - 10:52 AM

And another thing to remember..... If the local paper wants to do a story on your 4 year old son who knows how to set up inflatables better than most grown men..... be careful of the DOL and child labor laws.....

jm2c




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