Working Your Way

Working Your Way:

How Pregnancy Forced Me to Make My Business Work For Me

Most pregnant women understand the urge to “nest” and get ready for their baby by preparing a nursery, attending childbirth classes and reading books on what to expect. In 2015, I was a pregnant entrepreneur and pushed myself to “nest” for my baby AND business all at once. More staff hirings ultimately helped me prepare for my new position: Mother & Business Owner. Although the push challenged my comfort zone and was time-consuming, it ultimately set the stage for me to have a maternity leave and come back to work in the capacity that I wanted.

I know not all of you will be pregnant, but this is an example of how you can empower yourself to change the structure of your business to make it work for you. Maybe you want to go on a 3-month yoga retreat, spend extended time with family, tend to an illness or disability, or you just want a different work/life balance.

I’m a pretty proactive person but I admit I got complacent. Ultimately, in order to grow and/or step back a bit from the business, I had to feel like my back was against the wall. Whenever I look at hiring more office staff, it’s easy to fall into the trap of not wanting to hire for fear that employees can’t handle the job/task as I would - i.e., won’t have the same detail, experience, knowledge, etc. In the past, I thought it was better for me to do it and do it right than pay for someone else to do it, maybe mess it up, and have to spend time cleaning it up. However, experience and data have shown me over time that when I hire office staff, the company improves - a lot.

Things to consider:

Tasks & Job Roles:
I started by looking at what tasks I was doing that I would no longer be able to do (or wanted to do) on my maternity leave and beyond. In my case, I didn’t want to be needed for certain daily tasks. I still wanted to help with certain weekly or monthly tasks (ex: invoicing clients, payroll, staff meetings).

One of the challenges I had was coming up with job roles that worked for office staff members whose roles sometimes had them out of the office. Prior to maternity leave, I was often “the back up” person for key exchanges if an office staff member was needed out in the field for an emergency but now it became clear that a different backup plan was needed. Therefore, a new role emerged and part of that role included regular office hours to ensure we’d always have someone in the office prior to walking routes starting. Keys were always a hassle and at times disorganized but ultimately with a staff member overseeing that as a core responsibility, the process became more organized and became smoother as a result, which benefited my entire staff.

Manuals:
The next task was to get everything down in writing for the processes being done by me and other team members so that I could create continuity when turnover occurred. We created manuals for all the tasks we could think of. We tried to make them as comprehensive as possible and included screenshots and help/support numbers. For a process like hiring dog walkers, a manual would contain:

● Strategies of where to post job ads (web-based and/or physical) along with passwords or screenshots.
● Templates of job posts for each position we’d hire for (dog walker, cat sitter, based on “X” location)
● What dates/times to post
● Templates for follow up responses to applicants with FAQs
● Templates for setting up phone and/or in-person interviews
● Questions to ask the applicant in the interview
● Templates for follow up steps with the applicant
● Instructions for submitting a background check and relevant screenshots.
● Instructions for reading a background check and relevant screenshots.
● Template for offering the job to a candidate

Candidate Consideration:
The next task was to think about who would be the ideal candidate to implement the processes and system I had laid out. Would a dog walker or cat sitter on my staff be a good fit for a promotion or would an outside candidate with different skills be preferred? Does the candidate need to be in the office daily, work from home or work in a different state? In my experience, there are some positions that could be remote- like a scheduler or receptionist - which opens up your pool of talent.

Emergency Plan:
In an ideal world, you also have an emergency plan. What happens if one of the office staff members or walkers quits or needs to reduce their hours during this time? Do you put another member in charge of hiring a replacement? What systems do you need for your team to be able to effectively communicate to get assistance in an organized and real-time manner? I empowered a staff member to take over all walker hirings in my absence. With the manuals I created and our specific training plan, I was able to still create continuity in the position. We also use tools like Skype and Trello for effective communication. By spending time proactively to increase my office staff and their respective responsibilities, I was able to achieve the balance that I needed. The shift became one of overseeing daily operations to one of overseeing a staff that runs the business. I still work very hard, but I’m more able to set my own schedule and be proactive with my time - rather than reacting to day-to-day issues.

What You Need to Know About the Changes to Yelp's Algorithm - A Servant's Heart Web Design and Marketing

We know that it’s tough enough to run your business while being compliant and Yelp’s new filter is making it even more difficult to keep your online presence at its peak! Check out this awesome article which gives you the rundown on what Yelp is looking for now with reviews.

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A Servant's Heart Web Design and Marketing

What You Need to Know About the Changes to Yelp’s Algorithm

Yelp Changes The “Rules”, Makes Keeping Positive Reviews Harder

Yelp connects people with local businesses of all kinds, with users contributing more than 100 million reviews since its founding in 2004. It’s the go-to review site for businesses in the service industry, ranging from restaurants and salons to mechanics and plumbers.

Yelp says that it was built to foster connections between the consumers who read and write reviews, and the local businesses that they write about. Many local businesses rely heavily on Yelp reviews to bring in both repeat and new customers and to facilitate their reputation management strategies.   In November 2018, Yelp changed its algorithm, also referred to as its “recommendation software,” which unfortunately led to millions of Yelp reviews being lost.

Yelp filters reviews. That’s nothing new. However, the way in which it filters reviews displayed as “recommended reviews” faced big changes two months ago, affecting nearly everyone in all niches. The conclusion? Yelp may now be filtering reviews when there are too many positive ones. This has been suspected since many businesses have lost lots of reviews, in some cases up to 75% of their reviews. The backlash on social media showcases surprised, frustrated and downright upset unhappy business owners who have no idea what’s going on. After all, reviews are hard to get! No one wants to waste them, especially the really good ones.

This change makes Yelp more difficult from the standpoint of online reputation management. It came at a pretty bad time since Yelp is becoming more and more important because it’s the local search engine that Alexa uses for Echo device queries, such as “what is the best home care company near me?”. With the news that more than 100 million Alexa devices have been sold, it is becoming imperative that home care companies and other SMBs (small and medium-sized businesses) do everything they can to optimize their presence on Yelp.

The new Yelp algorithm breaks down in this way:

  • Yelp activity: if Yelp sees that individuals are spending little to no time browsing Yelp on their phones or computers, these will be deemed “dead accounts” and reviews will be removed.

  • Too many positive reviews: If a business’ reviews are too positive, the algorithm can demote some of those positive reviews so it can show a combination of positive and negative reviews in an effort to be more helpful and reliable.

The Ghost

Yelp’s latest update has been called “Ghost” — referring to its largely invisible presence that took many by surprise. Many businesses lost a high percentage of total reviews to the “not recommended” portion of Yelp. Some lost more than 1,000 reviews. It became apparent that something big had happened where the recommendation software was concerned, as it was now recommending fewer reviews for public viewing. Yelp refused to comment on or even acknowledge that a major update had occurred.

However, anonymous sources say Yelp made a major update to its system in late October. Here’s what we know about Ghost and why it was aptly named:

  • The update happened right around Halloween.

  • Several user reviews disappeared into the “not recommended” section.

  • The update seems invisible, with hardly anyone noticing except those who were affected.

Search Engine Journal examined a data set of nearly 700 monitored Yelp business profiles, focusing on the review counts on the profiles before and after the update happened.

Of the nearly 700 Yelp-monitored accounts, nearly 190 lost reviews between late October and early December.

Of those businesses that lost reviews:

  • 46 companies lost 20 percent or more reviews.

  • 61 lost 10 to 20 percent.

  • 80 lost five to 10 percent.

There were about 500 businesses that did not lose any reviews. Overall, the update affected one in four businesses.

Key Take-Aways

So, what should you know about the change? There are several things:

  • This was a cross-platform-wide update.

  • The reviews put into the “Not Recommended” weren’t all comprised of five stars. Of the nearly 190 businesses that lost reviews, two businesses lost one entire rating point and 45 lost .5 rating point; however, 140 lost no rating points whatsoever.

  • It didn’t matter if the business was an advertiser with Yelp or even a Yelp Elite.

  • Even reviews that had been on the platform for multiple years were filtered.

What to do if Affected

No one really knows what specific factors Yelp updated in its recommendation software. But it can only be speculated that Yelp learned about certain trends in reviewer activity. There are many signals that Yelp looks for in its recommendation software when thinking about filtering reviews, as evidenced on its own website. According to Yelp’s own words, its software looks at many different signals to measure reliability, activity, and quality. What it mostly concentrates on, however, is for those who are motivated to share a wide spectrum of detailed, rich experiences they encounter with businesses on a daily basis.

In a nutshell, Yelp is looking to display current, active reviews. If you were an affected business of Ghost, try not to get upset with Yelp. Just like Google and other online giants, changes happen every day that may not seem to make sense to us but due to that particular company. Instead, improve your Yelp presence by:

  • Including a “Check-In” offer.

  • Sharing positive Yelp reviews on your social media pages.

  • Installing the Yelp review-widget on your website.

  • Responding to reviews promptly.

  • Monitoring all reviews you get on Yelp.

Do not:

  • Directly reach out to customers for reviews.

  • Send out direct links to your business profile, as Yelp tracks referring URLs.

  • Use review solicitation software for Yelp reviews.

Hiring Independent Contractors vs Employees

Should You Hire Independent Contractors or Employees?

Hiring for the first time can be a terrifying necessity if you plan to grow. You must trust that another person will deliver the same care you have always provided your clients, and that loss of control often leads owners to grip tightly onto rules for their new staff members to follow. But the amount of instruction you are allowed to give your new hires depends on how you define the relationship between the two of you.

If you are an owner who is intending to create practices that each worker must adhere to, you will likely prepare a how-to manual that details how you would like your company representatives to perform. You may think about having your workers sign a non-compete agreement so that they remain loyal to your company, and you may expect them to work with you on a continual basis so you can offer your clients a consistent walker or sitter.

If, on the other hand, you are comfortable with allowing staff to run independently with little oversight, the alternative is to operate similar to that of an agency, connecting independent dog walkers and pet sitters (who operate like independent businesses) with customers for short-term contracts. Each worker would define their own rules as to how the walks and pet sits are performed, and they would be liable for purchasing their own equipment and filing self-employment taxes.

These two distinct ways of running your company illustrates the differences between hiring employees and hiring independent contractors (ICs), as defined by the Internal Revenue Service (IRS). The differences between the two are stark, so why are so many dog walking and pet sitting companies operating with an employer-employee structure yet declaring a business-contractor framework to the government?

Tax Documents

Defining Independent Contractors and Employees

The vast majority of first-time business owners are drawn to the idea of bringing on independent contractors because, by all accounts, it seems easier and less costly than hiring employees. And it’s true, hiring employees means the company is responsible for withholding, depositing, reporting and paying employment taxes, paying unemployment tax on wages paid and providing workers compensation, along with other benefits such as sick leave and holiday pay.

In online pet sitting forums, many members discuss freely hiring ICs, and there are likely other companies in your area who operate this way. However, before following blindly behind this trend, you must consider the legal consequences of your decision.  

In determining whether the person performing the work is an independent contractor or an employee, there are three main categories the government considers:

Behavioral Control: Behavioral control refers to whether the business or the employer has the right to direct and control the worker. An employee is subject to the business’s instructions on when and where to work, what tools or systems are used, what work must be performed by that individual and in which order the work should be done. Additionally, if there is an evaluation system in place or any training has been provided by the business, the assumption is that this is an employer-employee relationship.

Financial Control: Financial control refers to the control that a business has over the economic aspects of the worker’s job. An independent contractor will typically invest in equipment necessary for the work, and they are permitted to advertise and seek additional dog walking and pet sitting work – even if that means working for your competitor.

Relationship: Many companies will ask their new hires to sign a contract defining them as independent contractors and obligating them to pay their own self-employment tax. However, these contracts matter little to the IRS because how the parties work together ultimately defines the employment status. If you hire a worker and expect him or her to stay for longer than a specific reservation, this is considered evidence that there was intent to create an employer-employee relationship. Finally, if the worker is performing duties that serve as the main source of income for the company, they are more than likely an employee.

When reviewing the differences between an independent contractor and an employee, there leaves little grey area as to how pet sitting and dog walking companies should be defining their workers. More often than not, pet sitting and dog walking companies operate in an employer-employee structure but classify their workers as ICs. There are some business owners who simply do not know the differences, but there are also companies who knowingly misclassify their workers thinking they are too small for the IRS to flag, while other companies are willing to take the risk.

Consequences of Misclassifying an Employee as an Independent Contractor

If you fall into the category of thinking your company is too small for the IRS to notice, think again. An independent contractor who tries to file for unemployment wages or a disgruntled IC who reports his or her possible misclassification can lead to an IRS audit of your business. If you are found to have misclassified your workers as independent contractors when in fact they are being treated as employees, you will be responsible for revising your three previous tax returns. Once you have accurately re-filed your returns, you will owe three years of back taxes on all misclassified workers.  

Once subject to a review by the IRS, you do have the option of voluntarily reclassifying your workers before the determination is complete. This voluntary reclassification is also available for companies not yet flagged by the IRS, but who want to begin treating their workers as employees. The advantage to voluntarily reclassifying your workers as employees before the IRS conducts an audit is a partial relief in tax penalties, but those looking to utilize this program must still amend their tax returns for the previous three years.

When considering hiring, ensuring that your company is compliant with the IRS’ employment status determination will save you time, stress and financial hardships down the road. Should you wish to operate a company supported by independent contractors, you will be contracting single-person businesses you have minimal control over. However, if creating a company culture and defining the processes by which your hires will operate, you will be best served by setting up the employer-employee relationship from the start.

To view the full definition of the relationship between employers-employees and employers-independent contractors please see the IRS’ website: https://www.irs.gov/newsroom/understanding-employee-vs-contractor-designation

Houston dog mysteriously dies under care of popular dog walking app Wag

Instead of receiving a call to confirm that Winnie was back home after the walk, the couple was told Winnie was at a nearby vet and they needed to go pick up her body.

"We were devastated. Winnie was our best friend," Nick said. "We would get grief from our family because our world revolved around that dog. We were just in disbelief."

Nick and Sara Moore of Houston hired a dog walker through the popular company Wag in Dec. 2018. After Winnie was killed during a walk with a Wag walker, the company allegedly offered the couple a little less than $200 to keep quiet about the incident and refused to answer any of their questions.Media: Nick Moore

The Moore's said they experienced several major inconsistencies from the time they heard the news about Winnie up until their last contact with the company. Any history of Winnie's last walk, which was recorded by GPS through the app, was deleted. The couple never found out where the accident took place or who even took their dog to the vet after she was struck.

"Every time we talked to them and we tried to get information, we got conflicting information, information that didn't make sense," Nick said.

A representative from Wag provided the Chronicle with the following statement regarding Winnie's death:

"We were deeply saddened by Winnie's death, and we extend our sympathy to the Moore's during this difficult time. The walker has been suspended from the Wag! platform. We have offered to reimburse the pet parents for their expenses."

The Moore's said Wag did offer to pay for Winnie's cremation but required that they sign a settlement and non-disclosure agreement preventing them from sharing any details regarding the incident. That included posting about Winnie's death on social media, posting any negative reviews or holding Wag or the walker responsible.

They decided not to sign the document and after much debate, shared a heartbreaking video of Nick playing with Winnie, commenting on the incident. The Moore's said their intentions were not to cast blame on the company or seek revenge but to hopefully inform other Houston dog owners of their personal experience with the company.

"We thought to ourselves if this happened to our neighbor or one of our friends, we would want them to tell us," Sara said. "We felt like we would be doing a disservice to the people we cared about [if we kept quiet]."

The Moore's post went viral, earning over 138,124 views as of Jan. 21. They said they received support from all over the world and have been overwhelmed by people's responses to their story.

"I've had someone reach out that said she had a similar story and us sharing our story has given her the confidence to share hers as well," Sara said. "It's [the online response] so much more than we anticipated, but we don't regret our decision."

Monday night, Wag's chief executive officer, Hilary Schneider, shared a letter to the Wag community addressing various claims other Wag users have made, including how the company responded and handled recent incidents.

Schneider stated in the letter it will be "revisiting and reviewing" customer service systems and is also updating its payment claim.

"As a result of your feedback, we've already updated our policy regarding such agreements so that we're responding with the highest level of sensitivity to the nature of each individual case," the letter stated.

Rebecca Hennes covers community news. Read her on our breaking news siteChron.com, and on our subscriber site, houstonchronicle.com. | rebecca.hennes@chron.com| Text CHRON to 77453 to receive breaking news alerts by text message


New ABC Test For Independent Contractors Sends California Employers Reeling

Are you running a business in California? If so, there is an important ruling regarding employing 1099 contractors. More and more states are considering adopting this same ABC test. Read below for important information and let us know if we can help!

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The “ABC test” recently adopted by the California Supreme Court in the Dynamex Operations West, Inc. v. Superior Court case is now touted as the best way to make the distinction between an “exploited employee” and an “entrepreneur.” The court’s adoption of the ABC test for determining whether an employee should be classified as an employee or independent contractor has sent shock waves to businesses which have relied in the past upon a flexible, multi-factor common law test where none of the individual factors, taken alone, are necessarily controlling.   

ABC Test

A hiring entity classifying an individual as an independent contractor now bears the burden of establishing that such a classification is proper under the “ABC test.” To do so, the entity must prove each of the following three factors:

(A)  that the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;

(B)  that the worker performs work that is outside the usual course of the hiring entity’s business; and

(C)  that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

More than 20 states already use some form of the ABC test, although for most of them the test has been used for only a particular inquiry such as unemployment insurance determinations. In California, however, the state Supreme Court specifically ruled that the ABC test should be broadly applied for inquiries under the California Wage Orders as to whether a worker is an employee or independent contractor.

Because the Wage Orders regulate the terms and conditions of employees in all industries and occupations, the new test will have far-reaching consequences. Some areas of the law remain unsettled, such as whether the ABC test should be applied to Labor Code claims not arising under a Wage Order (for example, claims for expense reimbursement under Section 2802) or to what extent state or local federal courts could find that an element of the test is preempted by federal law.

Applying The ABC Test

Many businesses have service workers who request to be paid as 1099 independent contractors. These include workers across a broad spectrum of occupations and industries, such as truck drivers, exotic dancers, contract accountants, IT workers, and even high-level managers with special skills. Among their most common reasons: avoiding income taxes or other tax relief benefits. But a worker’s request to be reclassified, standing alone, won’t turn the scales in an employer’s favor. 

In Dynamax, the court maintained that the public interest in social welfare does not always jive with the personal interests of workers and that, in the end, the intent of public policy in protecting workers is a central consideration in determining employee versus independent contractor status. The consequences of misclassification continue to raise complicated issues when multiple entities are involved, including joint liability upon a finding of joint employment. 

Another problem made worse by the Dynamex case arises from the growing number of workers in the “gig economy,” which depends on the use of independent contractors as a business model. Companies are now being forced to rethink whether their particular model at the heart of their business runs afoul of the ABC test and could result in misclassification liability.

In the end, businesses should think not only about their own potential liability, but the potential liability of affiliated companies benefitting jointly from the services performed. Given that the risk of misclassification presumably could be greater in such situations, vendors and business affiliates similarly should be concerned about these risks. They could impact contractual relationships including the attempt, noted by Dynamex, to spread the risks by various means such as indemnification agreements. 

PRONG A – “free from the control and direction of the hiring entity”

Due to the prevalence of decisions examining “control” under the old test, it is foreseeable that many businesses will suffer losses due to misclassification under factor A of the ABC test. The fact that some workers request, or require, a 1099 arrangement generally will not help much if the other facts don’t support independent contractor status. And one issue impacting this factor is whether the worker treated as an independent contractor was also the same individual doing the work when classified as an employee, which the Dynamex court cautioned is an example of where control is implicit.

PRONG B – “performs work that is outside the usual course of the hiring entity’s business”

Many employers in California using independent contractors have been confronted with the reality that, given the ABC test—particularly Prong B—their business model is in trouble. The California Supreme Court reasoned that services that would ordinarily be viewed by others as falling within the hiring entity’s business rather than a worker’s “own independent business” render that worker an employee and not a contractor.

The examples provided by the court where a worker would satisfy this prong and be properly classified as a contractor were relatively clear cut: a retail store retaining a plumber or electrician to perform maintenance work at the facility, not a service normally provided by the retailer. As for specialized technical work within an isolated function of an employer’s business, the court said these are not among the types of jobs that would typically qualify, even though these have historically fallen within a gray area. This prong of the test could create differing opinions among courts attempting to interpret the new law.

Because the Federal Aviation Administration Authorization Act (FAAAA) preempts state laws that relate “to a price, route, or service” of a motor carrier, at least in the transportation industry, employers may argue that the FAAAA preempts an overbroad application of the “B” prong. So far, however, California courts have not ruled in favor of preemption when this element was part of the larger list of factors subject to discretionary weighing. On the other hand, the 1st Circuit Court of Appeals, addressing Massachusetts’ ABC test, has found preemption of the B factor on different facts, so there may be some hope on the horizon if California courts revisit this question.

PRONG C – “independently established trade, occupation, or business”

Under the third prong, businesses will be required to prove that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work they are performing for the hiring entity. The court again referred to such workers as plumbers and electricians retained for limited functions or projects as those traditionally fitting into this prong. On the other hand, workers engaged to carry out a skilled function that is a normal part of a particular integrated part of a business—as opposed to someone in a separate trade, occupation, or business retained for doing a separate service outside the employment context—may nonetheless be prone to be viewed as employees no matter how skilled the work involved. 

For the above reasons, organizations with independent contractors will need to examine these factors as they relate to their business. There is good reason to be very careful with regard to engaging any independent contractors going forward, especially workers who are working as single individuals (“one-person company”) rather than companies who have retained a force of workers in an independent business. 

Does Dynamex Have Retroactive Application? 

There is yet another reason for concern by employers: the issue of whether the Dynamex decision applies retroactively. This issue could mean the difference between catastrophic liability or merely a correction going forward, as needed.

Businesses maintain that the new mandatory test adopted by the Dynamex decision should not apply to employers retroactively because it would violate due process. After all, businesses relied upon the older tests that balanced multiple elements for years, establishing their business model in reliance upon the more flexible factors. On the other hand, employee advocates contend that the decision merely clarified existing law and therefore should apply retroactively. This issue is currently before the California Supreme Court, and we should soon have an answer to this question. 

Does Dynamex Apply To Joint Employment Scenarios?

There is some good news, however. One California appellate court has already limited the scope of the ABC test, ruling that the test does not apply when determining whether two businesses are joint employers of an individual already treated as an employee. Instead, the court ruled that it only applies when determining whether an individual has been correctly classified as an independent contractor. A word of caution, however: the May 18 decision in Curry v. Equilon Enterprises, LLCcomes from a state appellate court, not the state Supreme Court, so there may be further court rulings on this topic before all is said and done.

Conclusion

Regardless of the outcome on the retroactivity and joint employment questions, businesses would be wise to carefully evaluate their independent contractor relationships with Fisher Phillips legal counsel in California to avoid liability going forward, as there are bound to be further legal decisions clarifying the application and scope of the ABC test.

For more information, contact the author at JSkousen@fisherphillips.com or 949.798.2164.

Business owners warn of consequences from minimum wage hike in Illinois

Are you ready for the minimum wage hike in your area? Let the PIC guide you through this process.

SPRINGFIELD — With an increase in Illinois’ minimum wage headed for approval, a group of business owners got together on Monday to warn of the consequences the law would have if no changes are made.

At a Statehouse news conference, they made a plea that Illinois communities outside of Chicago be spared having to raise the minimum wage to $15 an hour by 2025. The statewide rate is now $8.25 an hour.

“I and many business operators want to make sure employees make a good living,” said Mike Monseur, who operates Godfather’s Pizza and the Dew Chilli Parlors in Springfield. “We’d love to pay much higher than the minimum wage, but the market dictates what is affordable in order to keep our lights on and workers working.”

Monseur said he employs about 200 people at his restaurants, including people just starting out in the job market. If the higher minimum wage goes into effect, he said he’ll probably have to stop hiring inexperienced workers and possibly eliminate deliveries.

“I would like to keep investing in our community, but my government is forcing me to change or make other choices,” he said.

The news conference was organized by the Illinois Retail Merchants Association, which is pressing lawmakers to enact a tiered minimum wage. Its proposal would have a $15 wage in Chicago, while the suburbs surrounding Chicago would have a $13 wage and the rest of the state would have an $11 minimum wage by 2025.

The differences are meant to reflect that it’s cheaper to live outside of Chicago and that other areas of the state do not have the same economic activity as Chicago. The states of Oregon and New York use a tiered approach, paying a higher minimum wage in a major urban area and lower wages in less-populated areas.

So far, Gov. J.B. Pritzker has opposed a tiered system, and Illinois House Democratic leaders have also indicated they do not support changes to the minimum wage bill as it passed the Senate last week. If the bill passes as is, IRMA president Rob Karr said the result “is going to be devastating, particularly to suburban and downstate communities. Treating Chicago as if the rest of the state has the same strengths as Chicago is just simply illogical.”

Darin Dame, president of the Springfield Hotel Association, said some Springfield hotels could be forced to close if the minimum wage is increased and others may not be able to afford needed improvements. He said the average room rate might increase to as high as $125 a night, from the current $86 because of the higher wage.

Dame could not estimate how many hotel employees in Springfield are currently making minimum wage.

“A lot of the hotels in town try to bring in people above the minimum wage because we’re looking for a higher qualified person,” he said.

However, if the wage increases, he said, hotels will be competing with fast-food outlets and other traditionally lower-wage businesses for workers.

“It’s going to be hard for us to increase it another couple of dollars to try to find that person who’s a little bit above,” he said.

The House is scheduled to consider the bill in committee on Wednesday. That would set up a possible floor vote on Thursday. Pritzker has said he wants to sign the higher wage into law before his budget speech Feb. 20.

Doug Finke: doug.finke@sj-r.com, 217-788-1527, @dougfinkesjr

Independent Contractors vs. Employees

You may be in the process of starting your business or a seasoned business owner, but regardless of where you are in the ownership process, you want to run a business that abides by all laws. The problem is that the state and federal laws are complex and confusing.

We are here to simplify the process for you and explain one of the most important distinctions in the dog walking industry: employee classification. As an employer, you can employ either 1099 contractors or employees. Most people go off the common misconception that dog walkers are 1099 contractors as they typically work autonomously. Unfortunately, this does make walkers 1099s. There is a strict and thorough test to determine worker classification. Please note that the federal test CAN differ from state laws. In most cases, state laws tend to be even stricter on classifications. Please research your state laws if applicable.

Below is a quick checklist to help you determine your workers’ correct classification. Reach out to the PIC for specific questions and assistance-we are here to help you!:

Behavioral Control A worker is an employee when the business has the right to direct and control the work performed by the worker, even if that right is not exercised. Behavioral control categories are:

  • Type of instructions given, such as when and where to work, what tools to use or where to purchase supplies and services. Receiving the types of instructions in these examples may indicate a worker is an employee.

  • Degree of instruction, more detailed instructions may indicate that the worker is an employee.  Less detailed instructions reflects less control, indicating that the worker is more likely an independent contractor.

  • Evaluation systems to measure the details of how the work is done points to an employee. Evaluation systems measuring just the end result point to either an independent contractor or an employee.

  • Training a worker on how to do the job -- or periodic or on-going training about procedures and methods -- is strong evidence that the worker is an employee. Independent contractors ordinarily use their own methods.

Financial ControlDoes the business have a right to direct or control the financial and business aspects of the worker's job? Consider:

  • Significant investment in the equipment the worker uses in working for someone else.

  • Unreimbursed expenses, independent contractors are more likely to incur unreimbursed expenses than employees.

  • Opportunity for profit or loss is often an indicator of an independent contractor.

  • Services available to the market. Independent contractors are generally free to seek out business opportunities.

  • Method of payment. An employee is generally guaranteed a regular wage amount for an hourly, weekly, or other period of time even when supplemented by a commission. However, independent contractors are most often paid for the job by a flat fee.

Relationship: The type of relationship depends upon how the worker and business perceive their interaction with one another. This includes:

  • Written contracts which describe the relationship the parties intend to create. Although a contract stating the worker is an employee or an independent contractor is not sufficient to determine the worker’s status.

  • Benefits. Businesses providing employee-type benefits, such as insurance, a pension plan, vacation pay or sick pay have employees. Businesses generally do not grant these benefits to independent contractors.

  • The permanency of the relationship is important. An expectation that the relationship will continue indefinitely, rather than for a specific project or period, is generally seen as evidence that the intent was to create an employer-employee relationship.

  • Services provided which are a key activity of the business. The extent to which services performed by the worker are seen as a key aspect of the regular business of the company.

Pet Industry Coalition-Introduction

Welcome to the Pet Industry Coalition! We are a group dedicated to educate the public and petcare industry on the importance of running and contracting petcare businesses that are compliant. Compliance protects the business owner as much as it protects the consumer. One component of compliance is providing the proper insurance and training that is needed to ensure pets are kept safe. Did you know that not providing Workers Compensation insurance to walkers/sitters opens up the client to being sued and for business owners to personally and criminally be liable should an injury occur?

We don’t want you to be hurt by fines imposed by government entities or lawsuits that result in potential business closure. We want to provide you with the education and knowledge that lets you sleep better at night knowing you are doing everything by the book and lawfully. When you join our Coalition, you don’t become a faceless member in another cause; we want to develop a personal relationship with you to figure out how we can best help you. We have a team of experts available to assist you with anything from startup questions to more in-depth operational inquiries.

The PIC wants to make each business owner an expert at their craft. Let us help you!