REQUIRED WORK HOURS

Everybody's Uncle,

I work as a headhunter for a private firm in Florida and only get a commission based on people placed. My employer gives s me a very hard time about what hours I can actually come into the office and when I am here or not. My issue with this I am not on an hourly wage and thus am a free agent essentially. I have heard that it is illegal for a company that is paying only on commission to have required hours of work. Is this true? And what can I do about it?

Thank You,
RPS

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Dear RPS,

It is not a question of legality. It is a matter of IRS status - employee or private contractor.

There are IRS guidelines that determine employee or private contractor status. Briefly, if you are told when, where, and how to work, you may be considered an "employee." The IRS differentiates in one of its many available booklets. They will make a determination on request or when improper classification is claimed.

Many factors are considered - who provides: a workstation, office, desk, supplies, computer, office equipment etc

When an employer sets hours he tips the scale toward employee status. When a private contractor has only one employer this also leans toward employee status.


Private contractor status has advantages for the employer:
Reduced bookkeeping
No withholdings
No Company benefits (health insurance, 401-K etc.)
No social security payments

The private contractor benefits as well:
Business related expenses are deductible - car, transportation, supplies, computer, office equipment, phone, etc. (See 1040 Schedule C). But, health insurance, retirement and Social Security must be self-paid.

Private contractor or employee status is not optional but good planning can tip the scale one way or another.

Some columns in this department will provide food for thought.

May you prosper,
Everybody's Uncle