There are many pros and cons that must be considered by those thinking of hiring independent Concrete Contractor Hansen Hills CA, and if those are not factored into the hiring decision, there may well be legal consequences. Of course, it is always wise to go over your plans with your attorney, so this article is not to be construed as legal advice but rather some business alerts that need to be considered before making a decision.
Of course, the first thing to do is to consider the job that is to be done, the duration of the assignment, the pros and cons of choosing a permanent employee and the pros and cons of hiring an independent contractor. Then, you need to make certain that your classification decision will hold up if it is challenged by either your state’s or the federal auditors.
Why Would You Want to Hire an Independent Contractor?
The reason that drives most companies to decide to hire independent contractors is a simple one – money. There is no doubt that there is a definite financial advantage, and in most cases, the company does save money for a wide variety of reasons. Let’s consider some of the expenses that are almost always incurred when a regular employee holds a position.
· There is the 7.6% of the employee’s total pay that will be your share of the Social Security
and Medicare taxes. Obviously, this cost is one that cannot be avoided.
· There is also state unemployment compensation insurance to cover, and that amount will vary from state to state. But, it must be considered and cannot be avoided.
· There is also worker’s compensation insurance to be paid.
· If you provide health benefits, then that figure must be identified and factored into your analysis.
· Retirement is another cost that is often ignored when the hiring analysis is being done, but if retirement is offered in one form or another, it must also be considered and added into the equation.
Actually, those who have researched compensation, tell us that in most companies the compensation package often equals 33 1/3%+ of the annual salary of a given employee. This figure must also be added to your payroll cost.