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November 2011

Dad, is this you they’re talking about?

Dad, is this you they’re talking about? 299 100 PayReel

Very early in my career I got a good piece of advice:  “Never do a business deal you wouldn’t want your kids to read about in the morning paper.”  Alas, if only the Madoffs, Murdocks, and Nacchios of the business world had been privy to such sage wisdom.

Still, how many of us risk getting our 15 minutes of fame the hard way when it comes to hiring so-called Independent Contractors?  Let me quickly say that some of my best friends are IC’s … legitimate IC’s.  Contractors fill an indispensible role in our economy by providing highly-skilled, variable-cost resources.  As with many professions however, the dishonest or misinformed few cast a cloud of suspicion over the rest.

Okay, so let’s come clean.  Haven’t we all, at some point or another, done a mental calculation of the odds of getting caught misclassifying a worker?  Or rationalized the potential fines and penalties simply as a cost of doing business?  Or even convinced ourselves that we can interpret complex labor law better than some fresh-faced IRS auditor?

Sure I have.  But then I come back to this image of my son flipping through the morning paper and seeing this headline:  “Your Dad Knowingly Broke The Law.  Mom’s Pissed.”

It’s the “knowingly” part that I wonder how I’d explain.  Even though federal and state labor laws are complex, there are plenty of resources available to help figure them out … Just Google “misclassifying workers.”

This is more than the corporate equivalent of a speeding ticket I’m talking about here.  Company reputation, your credibility, employee morale, average penalty of $80,000 per misclassified employee, your kid’s respect … that’s what’s at risk.


PayReel’s clients, who are some of the biggest companies in the world, are constantly immersed in the chaos of producing multimedia content or executing live events. PayReel makes sure they have the right contractors at the right time in the right place, and that everyone gets paid properly. And, most importantly, they handle every last detail perfectly while making sure their clients think nothing of it. Relax. We got it.

The Healthcare Reform Head Fake

The Healthcare Reform Head Fake PayReel

At the risk of understatement, The Federal Affordable Care Act of 2010 (or, depending on your politics, ObamaCare) has become sort of a lightening rod issue.

One of the more controversial elements of the act is the assessment of taxes on businesses that choose not to offer their employees health insurance coverage.  If your company employs more than 50 people on a full-time basis (at least 30 hours/week), you, dear reader, have a decision to make.  You’ll need to do the math and then choose either:

  1. Begin (or continue) offering “comprehensive” health insurance coverage to each of your employees, or
  2. Don’t offer your employees insurance coverage and pay a $2,000 per employee penalty (after your first 30 employees).

Not to say your decision will be driven solely by arithmetic.  There’s the competitiveness of your employee compensation package to consider.  Will you be able to attract and retain top talent if you don’t offer a health plan?  What about the composition of your workforce?  Lots of temporary workers on your roster mean this may be a non-issue for you.

But most of us will be crunching numbers to determine how the cost of offering health coverage compares to the tax bill we’ll get if we don’t offer it.

But wait!  The debate in Washington rages on about how much (if any) of the Affordable Care Act of 2010 will actually see the light of day.  Hence, the head fake.  Our federal government fakes left then moves right (pun intended), leaving us standing here with our, uh, business plan in our hands.

To be sure, there’ll be more head fakes, end-arounds, and flea-flickers before this all gets settled.  But I, for one, am ready to see Congress take this political football right up the middle and score one for all the sick people who can’t find any humor in this issue.