CABL Forum - Re: 1099/w2 lawsuit

The other issue you could have if hes ruled as an employee is if you paid hi a piece work rate per job . All my install contractors were employees as I didnt want to be looking over my shoulder or the IRS . I thought I had my bases covered until one employee who was fired sued me for OT pay . I didn't realize that even though they were paid piece rate I had to convert the piece rate into an hourly rate based on their hours worked and make sure they are making minimum wage and if they worked over 40 HRs they were entitled to OT as well . Luckily the ex employee hadn't worked for me a long time and I paid him and worked with a labor lawyer and came up with a formula so I had my back covered for OT . Its not easy to do when paying piece rate to come up with a formula that works for everyone fairly as some workers will do the same route in less time as other workers so what I did is this for example . If I wanted a certain task to pay 50 .00. I lowered the rate to say 40 and I paid every one 20 hours OT every week no matter what as no one was working 60 hours but I paid them as they were . The IRS doesnt care if you pay out more OT then a person worked . What this did is kick that rate back up to 50 . which is all I wanted and the employees wanted . I still tracked their hours as its required.but nonuse everyone OT hours to bring them to 60 I also had to make sure with a 60 hr week they met minimum wage requirements but I was paying very good rates so that was never an issue .

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Re: 1099/w2 lawsuit