workers comp !!

If these "subs" have all of their own equipment, tools, insurance, etc., why wouldn't they just be in business for themselves? Not doubting you...just saying that if these "subs" have all the money for these things, wouldn't they be self-employed?

I just know for a fact that you can get in serious trouble with the IRS for reporting someone as an Independent Contractor(Contract Labor & Tools or 1099-Misc)if they are using ANYTHING that belongs to you. That can also cause major red flags for insurance audits for general liability and worker's comp. Not only that, if the Independent Contractor doesn't file his/her taxes, the IRS can come back to you for the taxes owed, and the red flags would be all over the place for an audit. Just saying...my fiance has a background in tax law and insurance regs...
 
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i was looking at running my co all subs what would u pay them 40%

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If they truly are a sub, they give you their price.
 
Actually, my main sub IS in business for himself; he does land clearing, primarily.

He subs my climbing/bucket work on residential stuff he lands, I use him for his grapple and big chipper on the larger residential jobs I land.

It's a partnership, of sorts, that has worked well for us over the years. We both make money, and end up with access to equipment we wouldn't normally use.

Neither of us bothers with employees.
 
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Actually, my main sub IS in business for himself; he does land clearing, primarily.

He subs my climbing/bucket work on residential stuff he lands, I use him for his grapple and big chipper on the larger residential jobs I land.

It's a partnership, of sorts, that has worked well for us over the years. We both make money, and end up with access to equipment we wouldn't normally use.

Neither of us bothers with employees.

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I think you missed the point of the previous posts. Are your groundsmen employees or subs, or you don't use groundsman, or is the landclearing guy your groundsman? The point is running a tree service really isn't condusive to soley using independent contractors and using no employees. This fact is no great revelation to insurance companys or the IRS. Thats not to say you won't hire subs like your land clearing friend for certain specialized tasks.
 
Sorry, BB...

No, we play "groundie" for eachother.


Mass law doesn't require WC unless you have 3 employees or more.
 
The W.C. for my groundie/climber is 16% of gross payroll. It used to be 19% of gross payroll. I'm using Pinnacol Assurance. Y'all might want to look into these guys.

The last thing I thought I would do is refer my W.C. insurer.
bangtard.gif
 
I have a zero loss record over 20 years, and they want more than that here.

Sounds like you got it pretty good!
 
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I have a zero loss record over 20 years, and they want more than that here.

Sounds like you got it pretty good!

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I believe you have to "pay in" to the system for a few years at higher rates, then as you go on without incident, they (hopefully) lower your rates.

That is one funky law about not having WC if you have less then 3 employees. What happens if you have two guys, and you drop a tree on one of them? My guess is you get sued, wishing you had WC.

On another note, any chance you could remove the picture of Tom from your sig? That joke is kind of getting old to look at. We get the point.
 
Yes, here in TN. the law reads 5 employees or less you dont have to carry it. That sucks, I have 4 and still carry it. I guess its what separates our company from the jacklegs...although they are underbidding me constanly. We do have a great clientel though.....
 
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Yes, here in TN. the law reads 5 employees or less you dont have to carry it. That sucks, I have 4 and still carry it. I guess its what separates our company from the jacklegs...although they are underbidding me constanly. We do have a great clientel though.....

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That is amazing! So, what happens if some guy gets killed or maimed on the job? Does the company get sued? Homeowner?

That is the most ridiculous law I have ever heard of.

Sounds to me like you are doing the right thing, but I hear what you are saying... just opens up the door for so much underbidding. Totally unfair. Anyone who employs someone should have to carry WC, no matter how costly it is.
 
Kind of the same in Ohio, under 4 employees and you are not required to carry work comp by law. You are still responsible if someone gets hurt though.

That is why I decided to carry the coverage even with just two employees at this time. To protect myself, the worker and the homeowner.

I try to get it across to the customer that my overhead is higher than "two guys, a truck and a chainsaw" I started carrying my work comp certificate in the truck with me to help get the point across.

If the customer is looking for just a low price, not quality and responsibility, then I probably don't want the hassle of doing business with them. JMHO
 
Not in LA...doesn't matter if you have one employee or 10 employees...worker's comp is a requirement. It sucks having to pay it, but at least your covered. Even if I was in a state that didn't require WC based on the amount of employees I had, I would still have it...too much liability in this industry to not have it. But if you're paying your people in cash and not running it through payroll, you nullify your coverage anyways...employees have to be run through your account. Good luck to you, man...but, I'm telling you, paying someone as a 1099'er or an Independent Contractor, and the IRS will eventually catch up with you for a field audit. The numbers/gross revenue margins will start to look a little bit too fishy to the feds, if you know what I mean, to justify not having any employees on the payroll and instead having all subs. BTW, to not require WC based on # of employees in certain states, is about the stupidest thing I have ever heard of...job-related accidents can occur regardless of how many employees you have. If you have no WC, the employee can then sue both the employer and the homeowner for the work-related injury. I just find that very hard to believe...
 
My sig pic stays in as long as Butch is out.


I'm hardly two-guys-and-a-pickup; It's a shame you feel that way.

FYI, it wouldn't matter how much money I paid to w/c, I cannot be covered, since I own the company. Pretty fooked, eh?

Don't know about dropping a tree on someone... we're supposed to be smart enough to not do that, aren't we?
 
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My sig pic stays in as long as Butch is out.


I'm hardly two-guys-and-a-pickup; It's a shame you feel that way.

FYI, it wouldn't matter how much money I paid to w/c, I cannot be covered, since I own the company. Pretty fooked, eh?

Don't know about dropping a tree on someone... we're supposed to be smart enough to not do that, aren't we?

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I didn't mean to offend you, from the way you describe your set-up, you fit the subcontractor guidelines.

I was talking about the guys that have a chainsaw so they MUST know how to do tree work.

I realize now that was kind of a broad generalization. I appologize.
 
No offense really taken, G.

We all know the type... two acres and a chainsaw, and they think they're lumberjacks.
 
Nope, you as the owner are excluded from WComp. That's why you, yourself, have your own insurance policy. Yeah, we all know how to cut trees, but accidents can happen still...you never know. No worker's comp and someone other than yourself gets hurt on the jobsite, and this employee can sue not only you, the business owner, but the homeowner's insurance as well. In LA, we have no choice...state Ag board doesn't require WComp, just GLiability Insurance; however, in LA, if you operate any kind of business, regardless of the # of employees, you are required by law to carry WComp insurance.
 
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