Independent Contractor

nohr4u1yr · June 2005

I need some help (I guess that's why we are all here)

We are looking for an IT Manager (administrator)

During a conversation with my boss he has spoken to a person he use to work with and stated that he didn't want to go through our direct hiring process (background check, drug test, etc.) and wants to bring him on as an independent contractor.

I asked him several questions regarding this person and why we wouldn't just hire him directly but he kept skirting my questions.

Personally, I think my boss knows this person has background issues and just wants to sidetrack them by making him an independent contractor.

Does anyone know of any rules or regulations regarding independent contractors? Any advice will be appreciated.

Thanks!!

MS HR · June 2005

independent contractor sets their own working conditions and completion of the job is the only thing by which they are judged./

could be the person is drawing a retirement which might be affected if he takes another position as an employee somewhere.

pork1 · June 2005

nohr4u1yr:

The opportunity for IT as an independant contractor would be accomplished as "out sourcesing" the IT functions. If the person is already an established IT business (self-employed), then it would be pretty easy to have an attorney to draw up a contract and begin operating. That person could even be given office space as a part of the contract and access to the mainframe computers again as a part of the contract. Billing and payment for specific agreed to contractural Industrial Engineering projects would go thru accounting and HR is no longer involved with that activity and his employees, if he hired the staff. Otherwise, the staff would be laid off or transferred to some other positions. The "beyond the arms length" concept, as it pertains to the IT functional activity, will be required for the IT function to be truly a consulting and "out sourced" function.

Keep us posted on what happens, I bet you are right that there are some hidden agendas lurking in the air!

PORK

nohr4u1yr · June 2005

This person would be taking over for our IT Manager that just left and will have two technicians under him.

It's not like we are setting up new systems, programs, etc. My boss is giving him a "salary" and he wants this person to give us an invoice each month for payment.

I'm just not sure about this one... I will keep you posted.

Thanks!

SMace · June 2005

So your independent contractor is going to supervise 2 of your employees? I see NO reason to believe this guy is truly an independent contractor.

It is illegal to do what your boss is suggesting. If he does it he will be cheating the IRS. Go to this link and read on page 5.

[url]http://www.irs.gov/pub/irs-pdf/p15a.pdf[/url]

If he will not listen, document your objection in order to CYA.

Crout · June 2005

Mace is correct. You can't simply slap the label "contractor" on a person, then treat him/her as a regular employee. It's against the law.

nohr4u1yr · June 2005

SMace - thank you for that link!!! I am going to talk to him to get some more information and let him know we could get into BIG trouble if we do this.

You guys are the BEST!!!

TN HR · June 2005

You may also want to hand your boss a jar of vaseline and ask him/her what the company's position (no pun intended) will be in a quid pro quo title XVII case involving this clown and one of the "subordinate" Techs. Can you say "negligent hiring"?

pork1 · June 2005

I concurr with all of the above, you simply do not want him to go there. Print out this post and comments from your professional associates and let him read it. TN HR is right on, but I don't think anyone will provide the ointment, unless it is you. You must find a way to turn the boss away from his desires and plan of action.

There was a good post on this subject not long ago search out contract labor and independant contractors post. Do a "google" for independant contractor or labor and it should get you to the specific FLSA issues.

PORK

LivindonSouth · June 2005

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TN HR · July 2005

Very cute

SMace · July 2005

What just happened?

WT · July 2005

A good deal of work has been done on the independent contractor issue and some big suits as when Microsoft employees sued for back benefits. If the issue comes up there are a number of things the IRS would look for: does the person do this function for others or only for you, does he set his own schedule, is there a chance for profit or loss, how much control over the method and schedule of work will be exerted, does he own the means of production (i.e. tools, work space or office space, software, hardware, etc.), and is he paid by the job on some sort of bid basis or paid by the hour regardless of production. I believe Pork spoke of an arms length relationship and that is as good a way to summarize as any. Ask yourself whether you would dock him if he misses time, would he be given vacation or insurance coverage, will he get a weekly salary, and would he be expected to conform to standards in your personnel handbook or policy. If answers to these questions are yes, then a court would very likely find the person to be an employee and not a contractor.

Independent Contractor

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