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.