Chapter 27
Hiring and Firing
Getting fired is nature's way of telling you that you had the wrong job in the first place.
—Hal Lancaster
It is oft said that your employees are your most valuable asset, but that may not necessarily be true. It would be nice if they were, and sometimes they are, but, simply put, employees are also a lot of work. Hiring them, dealing with the myriad issues and troubles that arise, letting go of the problem ones—employees take plenty of time and effort. So as you go about dealing with them, especially the hiring and firing part, there are a few things you should know to make things easier and to keep you out of hot water.
Employee or Independent Contractor?
It is not surprising that you might want to hire people and call them independent contractors. Although an employee and an independent contractor often perform similar duties, your obligations toward an independent contractor are minimal compared with an employee:
- You need not provide an independent contractor with workers’ compensation insurance.
- You need not match an independent contractor's unemployment insurance payment.
- Most important, you need not pay any portion of an independent contractor's Social Security or Medicare taxes.
So yes, it would be nice to hire independent contractors to do the job of employees (many employers do), but only if they are really independent contractors. There are two main distinctions between an employee and an independent contractor. First, employees have to ...
