Separate Business

CLM

Our CEO also owns another business, separate from this one. Work is slow here and he wants to send some of our employees to his other business to work. They would remain employees of this business and receive their pay from this business. It will also be a temporary situation.

Has anyone experienced this type of issue?

ACU Frank

The biggest issue I see is whether an employee who works at both businesses in the same week for a total of more than 40 hours is due OT. I don't know the answer, but that's the first question that jumped out at me.

marc

Is the other company going to be billed for the labor, plus an administrative upcharge?

The biggest issue I see involves achieving equity if the businesses have different owners/shareholders/etc.

davids

Just a couple of thoughts - 1) If the "loaned" employee has an on-the-job injury, which company will be liable for workers' compensation costs?; and 2) if either or both companies individually don't fall under certain federal statutes (such as FMLA, ADA, etc.) that have the number of employees as an eligibility threshold, does this situation create the possibility that a government agency or court would look at the combined total of employees to say the company now falls under the statute?

drehil

This does not sound like a good idea to me...to many issues. Work Comp, Unemployment, FMLA...blah, blah, blah. I give him an A for effort, trying to keep employees working, but this could cause a ripple affect.

NaeNae55

OTHER business needs to hire THIS business to help it. The 2 business sign a contract with each other. Both companies report income and expenses properly.

THIS company may need to report income in a new category, and if the work isn't similar there may be W/C issues. Otherwise, as long as it is brief and temporary, it should work out ok.

Good luck!

Nae