Commission Rates/ Independent contractors

Any owners out there who have independent contractors?

I supply a room with all equipment and back bar supplies to use, laundry supplies, phone, online scheduling, merchant services, menus, website, newsletter,samples, retail and other small perks.

The independent contractor not required to have set schedule and charges prices that are set by the company.

Any experience on a commission rate and what you provide for independent contractors. Thanks for any input.

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Permalink Reply by Linda-Marie Crespo on May 14, 2015 at 10:10pm

So if I undertand you, they rent the room and buy their own back bar products to provide the service? What about laundry supply, towels, gowns? who pays the merchant service charges?

what do you charge for 1 hour facial? I left LA for Colorado. Location definately matters.

Thank you

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Permalink Reply by Teresa Escoffery on May 21, 2015 at 9:19am

This is all very tenuous in terms of violating labor laws as to the improper use of independent contractors.

ICs can only provide specialty services the "general contractor" -- in this case establishment owner -- cannot provide themselves. If you are an esty, and subbing out work to Estys, they should be employees as they are merely serving as surrogates for yourself, not providing specialized services. A massage therapist working in a salon owned by an Esty could be an IC, so long as the other tests are met.

in ANY case, providing equipment to an IC crosses the line in to being an employee. ICs provide their own tools and equipment.

Cathy has a sub-lessee agreement, which is different than having ICs.

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Permalink Reply by Pearl Irigoyen on May 22, 2015 at 1:21am

I worked for a corporation as an employee and they supplied everything you mention on your post. I received 40% commission and 10% from retail and kept my tips.

Labor laws and the IRS don't care what you call the business relationship you have with the people you hire, they want to see that every aspect of the relationship adheres to their set criteria.

The relationship you're describing sounds like you have employees not Independent Contractors. But it can easily be fixed with a contract. Even then you have to make sure you're not in violation of any labor laws.

I suggest you review these links

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/...

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Permalink Reply by Sara West on May 22, 2015 at 11:22pm

From my experience it's 50 50 if they bring equipment and products it's 60 40 if you bring the equipment and products.