Hiring my favorite Handyman as full time..

10 Replies

Hi,

I have a good understanding with my handyman. Now I want to hire him as an employee. This guy is amazing and does pretty much everything except electrical/plumbing. What I want to understand is how much will be the cost? e.g Lets say he charges me $30/hr and he will be working for appx 300 hrs in a project so my cost will be:

A- if hired as handyman $30 = $9000

B- If hired as Employee ?? Keep in mind he will still get $30/hr as my employee. What I don't know if what will be additional cost e.g Worker compensations, Insurance, Soc sec, Hr expenses etc. Also is there an agency that can help me?

Thanks

@Rao V.   Pay him as a 1099 independent contractor.

Employee as in? 

Superintendent/Super of some sort? or as... Hourly Handyman?

Many people try to circumvent handymen limitations (ie, in CA it is $500/project max including both materials and labor, some say 600 not 500) for construction/repair work by treating the handyman as an hourly employee, but it backfires because CA bans just that.

Not familiar with WA laws so I digress, but where there's a will there's a way.

Note the fundamental difference between employee and independent contractor is if the worker is regularly supervised while at work hour to hour.

Originally posted by @Rao V. :

Hi,

I have a good understanding with my handyman. Now I want to hire him as an employee. This guy is amazing and does pretty much everything except electrical/plumbing. What I want to understand is how much will be the cost? e.g Lets say he charges me $30/hr and he will be working for appx 300 hrs in a project so my cost will be:

A- if hired as handyman $30 = $9000

B- If hired as Employee ?? Keep in mind he will still get $30/hr as my employee. What I don't know if what will be additional cost e.g Worker compensations, Insurance, Soc sec, Hr expenses etc. Also is there an agency that can help me?

Thanks

 It's not just the direct expenses to figure in the equation, the indirect expenses have to be considered. Consider the liabilities that you are accepting as his employer..

... driving around while on the clock, drunk, hits somebody...

... gets hurt on the job, giant increase in WC premium for a long, long, long time...

... damages products or materials during installation, guess who gets to pay for them and can't deduct them legally from his pay check...

... you run out of work, he collects unemployment...

These may be worst case situations, but they still exist and lets not forget incentives to being productive... hourly employees have little financial incentive to being productive, it basically comes down to a combination of a mixture fear of losing a job, how much they can get away with and of course their work ethic.

What all this means is that unless there is huge gain for you somewhere beyond just a couple of thousand dollars over a year there is no way you will offset these issues, there would need to be some very large gains, possibly non-financial to warrant hiring this guy versus paying him as a 1099.

^ well said. 

if a handman paid whether project or hourly/salaried, i'd still be worried about if he gets hurt and if the homeowner policy even with umbrella, would actually cover it.

it would be easy for insurance claims underwriting to look at the scope of work and say 'you didnt use a licensed contractor but were required to by law so we're not covering your unlicensed worker whether employee or independent 'contractor' since he's not licensed to do what he was doing in your house!'

Are you sure you need a $70k a year handyman?  Is overtime mandatory in your state?  

Rao, you should not pay him $30 as an independent and also as an employee. As an employee, you'd pay part of his taxes, he would have a stable job, more hours, possible benefits/labor protection, etc. He may have holidays, paid time off, etc. Perhaps $20/hour would be reasonable in this case.

What are you hoping to gain by making him an employee?

May be I will hire him as 1099. Btw $30 was only a example, I pay less than that.

Other might be using temp labor agency. Does anyone know a good agency for construction worker in Seattle

Tradesman International

Madden Industrial Craftsman & 

Labor Ready 

all 3 large temp agencies in the Seattle area for skilled and unskilled construction workers.  

Their pool of workers can vary widely so be very specific in what you're needing.

Employees vs. Independent Contractors..... learn as much as you can about the differences. Here are some sites to get you started.

http://www.westsoundworkforce.com/youd-better-know...

http://www.avvo.com/legal-guides/ugc/independent-c...

http://www.lni.wa.gov/IPUB/101-063-000.pdf

http://www.esd.wa.gov/uitax/taxreportsandrates/who...

When setting the wage of an employee, take into consideration the value of the total compensation package. Benefits often equate to about 1/3 of the wage/salary. So, $20 hourly wage + $10 benefits might equate to $30/per hour compensation.

Some labor laws regarding mandatory rest breaks (unpaid) and mandatory meal breaks (unpaid), as well as overtime requirements, will come into play. In Washington State overtime is based on hours per week, not hours per day, so it allows the employer more flexibility when you need a worker to put in a lot of hours on one day and not so many hours on another day.

One of the greatest advantages of having your handyman work as an employee will be that you can supervise and direct how he does the work, not just the outcome of the work. He can also work exclusively for you and establish regular work hours. They can add up to full-time hours of 32-40 per week, or part-time of less than 32 hours.

Contact the Small Business Administration in your area for some guidance and resources. Also, have a good attorney and good accountant on your team.

Updated over 3 years ago

I meant to say the mandatory rest breaks as an employee are paid, not unpaid.

Originally posted by @Rao V. :

May be I will hire him as 1099. Btw $30 was only a example, I pay less than that.

Other might be using temp labor agency. Does anyone know a good agency for construction worker in Seattle

When I did part-time interpreting work for the Boeing Company in Seattle, they hired me through Manpower. That was the way Boeing could avoid taking me on as one of their own employees, but could still set up expectations to meet their needs. My employer became Manpower. Boeing would tell Manpower what they needed and Manpower would assign me to do the work at their request. I was classified as a part-time worker for Manpower and did not have a benefit package. However, Manpower provided liability coverage, worker's compensation insurance and withheld taxes from my pay. I still was paid my regular freelance rate. Boeing was insulated from the labor law requirements and could request my services at will. Manpower made their money from the contract they had with Boeing. Even though I typically worked professionally as an independent contract interpreter, I had no problem working for Boeing through Manpower. Manpower actually functioned more like a payroll service, they didn't direct me in how I did my work, and they were very efficient. Win-Win-Win.

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