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Kaitlyn’s background handling property tax issues and motor vehicle dealers has sharpened her customer service skills. She loves being able to help people find solutions and just generally make their day better. Kaitlyn stays extremely organized so she can be at her best in her role. She lives by her calendar and planner.

Growing up, Kaitlyn’s parents owned a roller skating rink and the passion for skating has stayed with her into adulthood. She’s a serial DIYer and especially enjoys silversmithing and refinishing furniture. On the weekends, you might find Kaitlyn hanging out with her two pets or volunteering in her local animal shelters or soup kitchens.

Something else: Kaitlyn believes that good things take time, so if you drop by, you’ll likely find some of those good things fermenting on her counter in the form of kombucha or kimchi.

While California is the state that makes headlines for its frequent legislation and tough employment guidelines, Washington is very similar. It’s considered a risky state to bring on independent contractors due to its strict worker classification rules. The high stakes for mistakes mean it’s important for businesses to take care to stay in good standing. 

Worker Classification

Federal rules around worker classification continue to make it harder for companies to classify workers as independent contractors. Each administration has its own approach to worker classification, but democratic administrations tend to have their sights set on prioritizing misclassification. 

In addition to the federal legislation, states have their own rules. Washington has some of the strictest requirements surrounding worker classification and it’s important for companies to pay attention because violators risk strict penalties such as fines, possible jail time, and damage to their reputations. 

Why Does The Government Care About Worker Classification?

It depends on who you ask. Governing officials are quick to say their first motivation is watching out for workers. Beyond that, it’s clear that there are serious funds on the line, too. Independent contractors write off business expenses and sometimes underreport income while small businesses can avoid certain taxes with fewer W2 employees. In addition, independent contractors are more difficult to track and tax accurately than W2 employees. 

What Does it Mean For Business?

Properly classifying workers is a highly-complicated task. The distinction can depend on factors such as the ability to hire or fire a worker, the kind of occupation, the method of payment, location of the worker and more. Some employers lean toward hiring employees, feeling it gives workers more ownership in the company’s success. Others say leaning on independent contractors makes their business model sustainable. Either way, some companies have had to restructure operations completely or bolster their Human Resources departments to make sure they’re above board. 

What About The Workers?

Washington’s approach to worker classification (among other topics) purportedly intends to protect workers and provide reasonable protections, which is why many consider it one of the most worker-friendly states. Still, some independent contractors find such an approach makes it difficult for them to operate.  

Independent contractors set their own schedule and manage their own businesses. While they are still responsible for paying taxes, they can also take advantage of many write-offs. Along with the perks, they do have the responsibilities that come with owning their own business. They run their own books, pay quarterly taxes, advertise, purchase their own equipment, and deal with the seasonal nature of business. Independent contractors also don’t get paid time off and are responsible for purchasing their own health insurance.

Some workers prefer the stability and possibility for advancement that come with being an employee and having a greater presence at the office and familiarity with the ins and outs of the company.

What Best Practices Mitigate a Company’s Risk?

Unless a company is made up 100% of full-time employees, this subject is relevant to operations. Failure to classify employees correctly could result in fines, back taxes, and even jail time. To stay well on top of worker classification rules, businesses can first determine if their operations are exempt from applicable laws. From there, they can follow classification news and observe how changes play out in practice. For those without the capacity or interest in having an internal team dedicated to the task, engaging a partner can be a great option. Working with an Employer of Record (EOR) or Professional Employer Organization (PEO) is standard best practice in this evolving freelancer economy. 

While both provide payroll and insurance services, the differentiating factor is that an EOR relieves employers of much of the regulatory risk involved in working with independent contractors while a PEO operates as a co-employer and does not assume the employment risk.

What Are The Stakes for Mistakes? 

Big companies like Uber make headlines for their missteps and pay equally big fines for their worker classification choices. Still, it can be a costly mistake to think it’s only the big companies that face consequences. By rescinding the Trump Administration’s Worker Classification Rule, the Biden administration made it easier for workers to argue for minimum wage and overtime protections/compensation. In addition to having to pay back 100% of the matching FICA taxes they would have paid had they classified the worker correctly up front, employers can end up subject to additional penalties.

Misclassifying workers does not save money in the long run. Perhaps scarier than the possibility of monetary damages, misclassification has landed some business leaders under house arrest. 

In addition, class-action lawsuits, failed audits, and negative headlines can damage a company’s reputation to the point where both workers and consumers are hesitant to engage with the company. It’s just not worth it!     

Bottom Line 

With the increasingly narrow definition of an independent contractor, the US is embarking on the real-time evolution of the economy. The most common mistakes when engaging contractors in Washington are misclassifying workers, (of course!), being lax about training requirements, or making privacy and meal wage/overtime errors. 

As the economic landscape shifts and independent contractors rise in prevalence, the financial stakes and potential for missed revenue rise, too. In response, government agencies have been ramping up their focus on the subject. The IRS and DOL are not alone. States are attempting to crack down on misclassification while tightening the reins on training requirements as well as payroll guidelines.

Where the money goes, lawyers follow. There’s big money in class action lawsuits and new cases are always being filed. While fear is never productive, companies should be very, very conscientious when engaging independent contractors in Washington. Companies must be very vigilant to protect their business, stay compliant, and reduce the risk for fines and unpleasant attention from the IRS.

When is Engaging a Partner a Good Idea?

If you don’t have the in-house team to do the job right, it’s worth considering working with a partner. The bottom line is that doing business in Washington is complicated and the consequences for errors can be very damaging. While the onus is on employers to classify workers correctly and stay in line with the state’s changing requirements, it’s possible to navigate a rocky landscape with relative ease.

In our world, accurate worker classification and top-notch risk management when it comes to overtime, meal wage, and other laws are always the priority. We are the first to be aware when change is in the air. We track rules in every state as well as on a federal level and offer services to help clients stay compliant. Curious where your business stands? Reach out for a free consultation on your risk profile. 

Meet Ethan Morse–our market researcher.

Ethan’s background in computer science and his penchant for both programming and creative endeavors make him a natural fit for his role at PayReel. As a market researcher, Ethan identifies and reaches out to prospects who could benefit from PayReel’s services and software.

Previously, Ethan spent a decade as a sushi chef. He most enjoys making nigiri because of the level of excellence it requires. At one restaurant, he had to pass a test—making, plating, and serving the delicacy in front of his head chef. He stayed after hours practicing the form, which appealed to his desire to continue learning and improving. While the connection may not be intuitive, his current role requires similar skills—extreme attention to detail, organization, and patience.

While he considers himself an introvert, Ethan enjoys skateboarding, getting outside, and spending time with friends.

Something Else: Ethan is an avid reader and has three different books available at all times to suit his changing moods. At the moment, his reserve includes a classic novel, a book on economics, and a collection of short stories.

Do you ever get a little antsy about your life and find yourself wanting to change careers, remodel your house, or even cut bangs? In certain ways, it’s getting easier than ever to scratch that itch by getting a change of scenery without having to establish a new career. Between the increase number of self-employed folks and those with traditional roles that have recently turned remote, people are working from home in record numbers! This study predicts that the trend will only continue, with almost a quarter of the American workforce working remotely within two years. While some enjoy the traditional office environment, this study shows that 60% of employees find an out-of-office work life aspirational. That, in combination with the 46% of workers looking to change jobs in the coming year means a lot of us might be spending some time daydreaming on Zillow. Some states are willing to put up some cash to get you to consider making their location home.

3 States That Will Pay You to Relocate

The requirements vary a bit from place to place and you’ll need to make sure you qualify. For example, you may need to bring your own remote job and stick around for a minimum amount of time. Their incentives range from straight up cash to housing assistance and even office space.  Whatever you’re looking for, there might be something here to help you with a new start.

Vermont

If you’re ready to brave mud season and get a good dose of their famous Fall colors just heading out to the supermarket, consider Vermont. There, you could get a $7,500 grant if you’re selected for their relocation incentive program.

Iowa

If you could use some Midwestern hospitality in your life, head over to Newton, Iowa, where you’ll get big-time support buying a home if you qualify for their housing initiative (rhubarb not included).

Oklahoma

You’ll be blown away by Oklahoma’s incentives. Duncan offers $4,000 to new arrivals through its talent relocation initiative while Tulsa is luring folks with $10,000, free work desk space, and more with their Tulsa Remote program.

The Bottom Line

If you’re among the many folks looking for a change, you may as well consider the states that are incentivizing folks to bring their talents (and their remote incomes) to their locations.

The American Rescue Plan Act of 2021 changed the way businesses report income from payment cards and third party network transactions such as Venmo and CashApp.

Here’s What You Need to Know

Which Transactions Qualify?

While this form applies only to business transactions, it’s possible to mistakenly receive a 1099-K for a non-business transaction. If this happens, you can contact the issuer directly to address the error.

The holidays are upon us and so are the sales. You’ll find tech, entertainment, gadgets and experiences for everyone from those who are averse to letting new items cross the threshold of their home to your tech savvy loved ones. Here’s our curated list for just about everyone in your life—from the tech junkies to the minimalists (and maybe even for yourself)!

For When Your Loved One is Ready to Toast to a New Year

Get a wine / beer / liquor subscription or a home-brewing hard cider, beer, or wine kit if they’re extra adventurous.

For Your Family

Have some fun together.

For The Crunchy Folks

This Wellness Mama list is for the granola-bar making mamas looking for an environmentally friendly/healthy option for everyone from their kids to the grandparents.

For The Tech Enthusiast

45 of the best tech gifts for the gamers, gear junkies, and media fans in your life.

For The Minimalist

Minimalists don’t want things…at least not things they didn’t thoughtfully consider before allowing into their lives. So for people who want nothing, you’re better off either getting something very personal or sticking with experiences. Yep, it’s harder to think of ideas for that than just to grab a mug with the person’s initial on it at Target, but this list of ideas will help.

For The Travel Lover

This might be the perfect time to buy something for travelers itching to get back out to see the planet. This list sticks to gift cards because, while those living on the edge might be ready to book a nonrefundable option, most people will probably still feel a little safer with flexible options.

Bottom Line

It may seem early to start thinking about

If you engage a contingent workforce and would rather avoid fines, jail time, and damage to your reputation, this post is for you. This month, the Biden Administration rolled out a proposal that would make it harder for companies to classify workers as independent contractors. From the beginning, the administration has had its sights set on misclassification and this proposal makes it clear that it remains a top priority. While worker classification is important at all times, this kind of news makes it that much more important for companies to pay attention because violators can expect to be subject to strict penalties.

Fine, Jail Time, & Negative Press

Big companies like Uber make headlines for their missteps and pay equally big fines. Still, it can be a costly mistake to think it’s only the big companies that face consequences. By rescinding the Trump Administration’s “Worker Classification Rule,” the Biden administration made it easier for workers to argue for minimum wage and overtime protections/compensation. In addition to having to pay back 100% of the matching FICA taxes they would have paid had they classified the worker correctly up front, employers can end up subject to additional penalties such as the following:

• $50 fine for each W-2 form they failed to file
• A penalty equal to 1.5% of the employee’s wages 
• $5,000 penalty for the first misclassified employee and up to $25,000 for each subsequent violation

Suffice to say, misclassifying workers does not save money in the long run. Perhaps scarier than the possibility of monetary damages, misclassification has landed some business leaders under house arrest. 

In addition, class-action lawsuits, failed audits, and negative headlines can damage a company’s reputation to the point where both workers and consumers are hesitant to engage with the company. It’s just not worth it!  

The Bottom Line

Someone on your team needs to to protect your business, stay compliant, and reduce the risk for fines and unpleasant attention from the IRS. If you don’t have the in-house team to do it yourself, it’s worth considering working with a partner.

In our world, accurate worker classification and top notch risk management are always the priority. We are the first to be aware when change is in the air. We track rules in every state as well as on a federal level and offer services to help clients stay compliant. Contact us if you have any questions about your own status. 

P.S. They pay well, too.

If you’re already freelancing, you may be looking to either improve the disciplines you already offer or to add to your skillset to make your total package that much more valuable to your clients. Businesses used to consider proficiency in Microsoft Word foundational, but recent years have seen the addition of basic SEO and WordPress proficiency to the list of foundational skills f0r many occupations. Businesses are also looking to keep their data safe from hackers, stand out on an increasingly-crowded information superhighway, and tell their story on diverse platforms that will reach their clients. While it may seem like a lot (too much?), it also means there is plenty of opportunity out there. Whether you’re freelancing or looking for full-time traditional employment, being proficient in these skills will make you ultra-hireable.

Here Are Four Skills To Enhance Your Resume

Network and Information Security

Just like the internet and the world itself, hackers and scammers are ever-evolving. Once upon a time, a thief might’ve stolen the cash out of your pocket, but with the ability to steal an entire identity, the stakes increased. And of course now, with battle being waged increasingly in the online sphere, the stakes are even higher. A hacker can blow up an individual’s life and shut down a hospital all in a day’s work. It is sobering to consider that it’s happened to Equifax, multiple government institutions, and Zoom. So yes, it can surely happen to (or through) you.

Businesses increasingly need more than a security officer at the front door. They need safeguards in place to protect the sensitive data on their computers. In addition to the technical firewalls and other fortifications to their systems, they’ll need to fortify where they’re most vulnerable. In many cases, that’s their people. User error is responsible for most security breaches and hackers are getting more and more subtle and skilled to outsmart very smart/savvy people.

All of that to say that becoming at least proficient in security is good for your own financial world and becoming a pro makes you invaluable to businesses. Being able to offer security advice to your clients or employer makes you that much more attractive. Whether or not you’re consulting as a security expert, just being savvy enough not to fall for a scam (like this one, which took a Shark Tank judge for nearly 400K) could save your job and reputation.

Udemy offers The Complete Cyber Security Course: Hackers Exposed, along with a boatload of other courses to solve nearly any business challenge. With cybercriminals making headlines, it’s no surprise that people who can combat this threat increase their desirability. Whether you’re primarily a writer, video producer, website developer, or designer, being able to offer clients additional peace of mind is priceless. Especially for small businesses, who may not have a team dedicated specifically to security, your expertise adds value and makes you an essential team member.

All Things Webby

WordPress: With new sites being added daily, the Internet is basically one big WordPress matrix. Even if it’s not their core business, content creators who can build, update, or fix WordPress sites will keep businesses from having to hire additional people. Saving clients money is one surefire way to get in their good graces. Many free courses will absolutely give you a return on your time invested.

SEO: The only thing as constant as change is change itself…and SEO. The clever behind-the-scenes glut of the right words may have worked in the Space Jam days, but it doesn’t get results anymore. SEO has gotten much more sophisticated and tough to crack. The real key is increasing traffic organically. Having the tools to have an intelligent conversation on the subject and being able to point clients toward solutions makes you extra valuable.

Sales Funnels/ List Building: Sales funnels are a key to converting all that organic traffic into action. If you already have some knowledge of landing page design and content strategy, ClickFunnels (or something similar) is a great way to take your skills to the next level.

Instagram API: There are a lot of ways to use Instagram’s API—from turning a website into a living museum to converting sales. Often, companies spend a lot of time creating and posting content but fail to convert views into action. Add knowledge of Instagram API to your resume and you can become a conversion superhero. Learn more at Consuming the Instagram API by LinkedIn Learning and Build a Photo Web App Using Instagram API (cape not included).

Storytelling

Businesses are always looking to tell their story. Anyone can convey information through bullet points and data, but not everyone can weave those facts and data into a compelling narrative. It’s famously Apple’s storytelling and skill at communicating their “why” that made their “Think Different” ads so effective. Storytelling is important in writing, videos, podcasting, social media, and more. Get the principles of story and you can apply it to just about any medium.

Bottom Line