Posted on 09/09/2018 2:29:00 PM PDT by lowbridge
I have professional headhunters bringing me candidates on a regular basis. They are W2 employees of the recruiting agency. Non-employees. Hourly. We pay the company, they pay their employee. They are not 1099 type employees.
My son has been a real estate broken since 2007. He started as an agent in an office. The broker was his sole employer and set his duties and hours. He was supposed to have him tracked as a W2 employee. The broker failed to withhold taxes and pay his share of the social security. My son already had a BA in Business and was doing all of the real work in the office. He did some review and took the broker's license...and passed. He "lost" his job and opened his own corporation. That said, he has had tax problems for years that started with that jackass. He never fit the specs for a 1099 independent contractor.
mark
California’s pension system is going broke. The big brains who think up new ways to “make money” probably dreamed this up.
Instead of independent contractors renting space from the barbershop owner and paying self-employment tax, the State will get double the tax. The employer payroll tax runs up to 20% of employee’s salary. In addition, the employee pays taxes to the State.
I predict every person in California will notice the effect of this new law.
“Employers are going to scream because making your former employees independent contractors saves the employers tons of money! It means they don’t pay for workers compensation insurance”
When the wc insurance company payroll auditor does the payroll audit (wc premiums are based on payroll) the auditor will use the total contract price of labor and material of the sub to determine the additional premium to be paid by the principal, the business owner hiring the sub, independent contract person or company.
Most attorneys do not advise their contractor clients that they have this exposure so it can come as an unpleasant surprise when they get the additional premium billing for this exposure. Even greater surprise if the IC incurs an occupational injury while doing the contracted work and files a wc claim against the principal. The claim cost will then be added to the Experience Modification calculation of premium, possibly resulting in premium surcharge for the next three years.
In today’s workplace environment, an irate haircut patron just might have his weapon with him and shoot the barber for the lousy haircut thus creating a workplace injury and wc claim (unlimited medical, loss of earnings, widow and children death benefits, funeral expense) against the shop owner.
No US state wants to bear the cost of workplace injury claims being made by disabled workers, widows and orphans is why this
is in the wc state law of each state, otherwise the state taxpayers would have to pick up the claim cost.
Lawyers make more money on retrospective events than on prospective advice is probably why they do not advise their clients of this exposure or the alternative is that they are ignorant of their state WC law.
What you say makes sense - which means that as Kalifornia searches for ever more ways to soak the remaining taxpayers, it will likely turn it’s red-yellow eyes upon Uber and Lyft....
Driverless cars are great in urban areas, useless in rural areas. And it’ll be the Driverless cars that’ll put them on the wrong side of this ruling.
They bet on the wrong platform. Automated trucks and buses would have made more sense.
What state are you in
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