What to pay??

Discussion in 'Employment' started by millenium_123, Jan 27, 2009.

  1. PROCUT1

    PROCUT1 LawnSite Platinum Member
    from TN
    Posts: 4,909

    Ok

    Anybody that has a thought about doing the 1099 independent contractor thing......One word ......DONT.

    This was a common way for contractors to get away with not paying taxes years ago. Years ago there were gray areas and nobody got bothered.

    Nowadays the law is very clear.

    If the guy you have working for you has all of the qualifications and meets the requirements to be classified as an independent contractor, then he sure as heck wont be cutting grass for you.

    If it were that easy, everyone would be doing it.

    IRS is the least of your problems in the 1099 game.

    Wait until your workers comp or liability insurance carrier audits you and goes back 3 years. Get ready to pay.

    The 1099 independent contractor game is not a road you want to go down.\

    Your buddies in the business who have that "great accountant" they swear by are going to be in for a real surprise.

    If you are going to hire employees, youre in the bigtime now boys. This is business. Play by the rules.

    As far as piecework goes....You can pay that way perfectly legal...

    Their employee status doesnt change.

    You do however still have to keep track of their hours and see that their piecework pay is comparable to minimum hourly wage laws and overtime laws.

    Lets say minimum wage is 10 per hour to use round numbers.
    Overtime rate is 15 per hour.
    Im going to use the "over 8" instead of "over 40" calculation to make the numbers simple.

    You want to pay the guys 10 per lawn.

    today they work 10 hours and finish 20 lawns.

    his pay would be $200

    If hourly his minimum by law would be

    10x8hrs 80
    15x2hrs 30

    By law he would have to make 110. he made 200. Youre good.

    Tomorrow the truck breaks down and he only gets 5 lawns done and works the same 10 hours stuck with the truck.

    You pay him 50 for the 5 lawns.

    He is legally entitled to the 110.

    You have to pay him the 110 to be legal. paying him the 50 would be against the wage and hour law.

    To keep things simple you are much better paying an hourly rate with a production bonus.

    Pay them a lower hourly rate, with an incentive bonus.

    This goes both ways though. Dont only use this for your benefit.

    You want them to work hard. Set it up so that they have the ability to make more money by working harder than they would if they were strictly hourly.

    There is no incentive for them to bust hump if the most they could make is the same pay that they would get from someone just strictly paying hourly regardless of performance.

    Make it so they have incentive to get more work done for you and at the same time they make out better than they would hourly for the competition.
     
  2. Stillwater

    Stillwater LawnSite Platinum Member
    Posts: 4,806

    I said this in post#3
     
  3. topsites

    topsites LawnSite Fanatic
    Posts: 21,654

    Forget all 4 pages of this, what you do is once and for all grow some hairy sweaty twos and raise your rates until you no longer
    have this problem of more work than you can handle and you probably don't gotta do it but ONE dang time 5 lousy bucks
    and a good half of those so-called customers are gone and I GUARANTEE someone don't have this problem no more LOL.

    Because I don't know how much some think they pay themselves or how long they intend on staying in business,
    but the mere hint of a thought of paying an employee anywhere near what I get paid would be in violation of minimum
    wage law one but then I ain't in the mood to hear squat from the lying sniveling bunch either lol

    Now I am about tired of hearing it, folks ACT like this is some kind of miracle secret concoction to it all,
    they ACT like we get paid 100,000's an hour hell just TRY and charge someone 5 bucks more and see what happens,
    then they ACT like we can pay employees some ridiculous amount somewhere between 15-20 an hour and then just to
    ice up the cake they all expect me to believe that load of horse garbage?!

    How the HELL, when it takes 30-45 minutes to mow a 1/4 acre from START to FINISH that we MIGHT get 30 lousy dollars for,
    and that still doesn't include the time spent doing maintenance and deposits and scheduling and estimating and answering the
    dang phone, y'all know damn well just as sure as I do that in the net we might gross 25-30 an hour so how in the HELL can anyone
    DREAM about paying anyone the kind of rates that's being talked about?!

    L.O.L. and W.H.A.T.E.V.E.R.!

    Now I'm not entirely against edumacating these stuck up spoiled brats who would want to call themselves employees,
    but you see by the time the sorry punks are 5 minutes late on the first day they are fired because I ain't waiting for their sorry
    ass neither, nor am I getting into the thousand+ long list of real good reasons why I am NOT going through the hiring process
    again, not now, not ever, they can stand themselves up in that unemployment line until the day they FEEL like WORKING!

    And it ain't nothing personal against anybody, I just had to let it out, thanks for listening.
     
    Last edited: Feb 19, 2009
  4. Pennings Gardens

    Pennings Gardens LawnSite Member
    Posts: 75

    I'm also looking to hire a few more new guy this spring and set up a complete crew, what do you guys think of $10.- and hour plus 5% commission for a foreman? a slow day mowing with 3 guys is is what $500.-? this would be $80,- in salary and $25,- commission - $13.15 per hour. this would be 2 days a week. do patio or pond work and a bad day would be a $2000.- invoice, this would be $80 in salary and $100.- in commission - which is $22.50 per hour. They labor guy would just be pay by the hour. Would this be a good idea or not? I want to make sure the guys that work for us are happy and motivated, I'm not able to be on the job side everyday since we have the retail center to worry about also...
     
  5. NC Greenscaper

    NC Greenscaper LawnSite Senior Member
    Posts: 446


    That's funny :):):):)
     
  6. PROCUT1

    PROCUT1 LawnSite Platinum Member
    from TN
    Posts: 4,909

    "hairy sweaty twos" I love it....hahaha

    Topsites..

    Next time I come to VA, Ill buy ya lunch.

    I can only imagine how you must be in person.
     
  7. Lawn-Guy

    Lawn-Guy LawnSite Member
    Posts: 65

    well with what to pay some one is going to depend on there skill and knowledge level.
    i have been paid by the job by the hour and by salary for me anyways i prefered by the job that way i co ntrolled what i made not anyone else however with that said i also took responsibility for my own insurance taxs etc. as far as amounts to pay figure what i cost to live rent food insurance lights etc etc i was averging between 17-25 a hour when i was getting paid by job but i didnt eat lunch and didnt slack off and the owner of the company knew that and rewarded me nicely with bonus money every quarter anywere from 500-1000 dollars as a gift tax free
     
  8. starry night

    starry night LawnSite Silver Member
    Posts: 2,600

    I feel the urge to comment on this post but I'm not sure where to start. (All the run-on sentences make it hard to understand.) It sounds as if your employer was paying you "under the table." That is, he wasn't withholding taxes??
    And are you saying you cleared $17-25 an hour AFTER you paid your rent and food?? Then the matter of the "tax-free" bonus: it's not legal for an employer to pay tax-free bonuses or cash gifts to employees without also taking out withholding.
    I'm doubting the validity of the information in your post. Please try to clarify if you want to.
     
  9. Lawn-Guy

    Lawn-Guy LawnSite Member
    Posts: 65

    sorry for the run on sentences is was rather late. what i was saying was he payed me as i was a contractor, my pay averaged 17-25.00 for the hours i worked (example if i worked 40 hours i got paid between 680.00-1000.00 a week) granted i was at this time doing no lawns but yet mainly doing renovations,ponds and retainer walls. out of this money i would pay my self put fuel in my own truck and pay a helper if i opted for one. i hope this clers it up a little for you. as fare as the bonus money goes it was a gift from him to me not his company to me. and yes i did my own taxes(1099)
     
  10. straightlineland

    straightlineland LawnSite Member
    Posts: 41

    I would stay away from the whole paying by the job...unless you want to create a new competitor for yourself. In order to pay them by the job, they get to know what you are charging. Before you know, they will think they can go into business for themselves and under cut you. Not thinking of all the overhead etc. We all see it every day with new mow and blow guys who have a truck and mower and call themselves landscapers. We don't need anymore of these guys.

    I pay my foreman a salary. they stay on all year. We work more in the 5-6 days in the summer and 4 days in the winter. They get paid the same every week. This can be slippery though. They have to be considered managers. I give my guys the authority to write up their crew members, fire, hire, and we do have meetings in which they discuss input. They get bonus', paid vacation, and health insurance too.

    My laborers are paid hourly. This works out because my foreman get paid whether they work 4 hrs or 10 hrs the same, so they want to be efficient and get done, the hourly guys want the hours. You must hold your foreman accountable for their properties though, if they are trying to blow threw them to get done early. My guys are really very good and have been with me for 6 - 10 years.
     

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