[GMAN]

Originally Posted by chris1

1099 an employee fits right in with a LP. The employer that uses a 1099 extolls the virtue of it,as they avoid any of the associated payroll taxes. A cheap occupational health policy instead of comp,no chance of UC if you're fired without cause,the employee paying both sides of fica and medicare. And of course they don't offer a higher rate of pay because of that.

I like the occupational accident policies over workers comp. I think that they are easier to collect on than workers comp. Benefits are similar to workers comp, but the cost is usually less. Not all who pay on a 1099 pay a lower rate. Many pay a higher rate. For instance, many of the car hauler companies pay percentage. The percentage is high enough so that the driver can afford to pay his own taxes. I think that often the company would rather pay the higher rate than do all the associated paperwork that the government wants. The lease purchase people want to have their own business. Paying taxes is part of being in business. I don't like the lease purchase programs, but many like them and continue to get involved with them. If someone wants to do a lease purchase it is their responsibility to pay their own taxes and workers comp or occupational accident policy.

If some of those paying on a 1099 were forced to pay the taxes on those currently working under a 1099, you would likely see pay drop to offset the increased costs. A good solution is that if you don't like working under a 1099, then go with a company that pays all of your taxes for you. No one has to work for a company on a 1099. If you are offered a 1099 position and don't want to do it, then DON'T. I have not heard of anyone who has been forced to work under a 1099.

[chris1]

The truth is they pay 1099 to cut their costs and push them onto the employee. But i'm sure the 1099 employers say the employee has control,like they would allow someone going from Boston to Seattle to go through Dallas with out charging them. Any way you cut it,they are employees. They are no different than those who cut corners and avoid other requirments. And they will be the first to complain about those people.

[Mackman]

Originally Posted by chris1

The truth is they pay 1099 to cut their costs and push them onto the employee. But i'm sure the 1099 employers say the employee has control,like they would allow someone going from Boston to Seattle to go through Dallas with out charging them. Any way you cut it,they are employees. They are no different than those who cut corners and avoid other requirments. And they will be the first to complain about those people.

AMEN

There is a reason companys want to pay on a 1099 over a W2. Cuz it saves them money.

[chris1]

Of course they say it's all for the employee. And the occupational health is better than comp? It has a total dollar limit vs no limit for comp. It pays a far smaller weekly amount than comp. But it's far cheaper(for the employer). Some even expect the employee to pay for it.

[GMAN]

Originally Posted by chris1

Of course they say it's all for the employee. And the occupational health is better than comp? It has a total dollar limit vs no limit for comp. It pays a far smaller weekly amount than comp. But it's far cheaper(for the employer). Some even expect the employee to pay for it.

Some of the older occupational policies did pay a low rate. Some only paid about $300-400/week. That may not be enough to pay the bills should something happen. I think that OOIDA and others have raised the payout rate quite a bit. I think someone mentioned that they pay up to $700/week now. Neither workers comp or occupational accident policies are designed to replace your entire paycheck. I think that they pay from 50-75% up to the maximum amount of the policy. As I recall, they used to top out at a minimum of $500,000 and some went up as high as $2,000,000 lifetime benefit. There is nothing wrong with saving money as long as you feel that you are getting value for your money. Most carriers require all their owner operators and lease operators have either an occupational accident policy or workers comp. With either it is unlikely that they would provide as much net income as the owner would earn working. I think that everyone needs to decide what is best in their situation and resources dictate. If a driver and owner agree to certain terms, I don't see that it is anyone else concern. It should only be between the company (or owner) and driver. My thinking is that if you don't want to work with a 1099 or have an occupational accident policy in lieu of a W2 and/or workers comp, then don't take the job. Either find a company that pays on a W2 and has workers comp or buy your own truck and start your own company. In any case, if you take the position where you know you will be paid on a 1099 and/or have an occupational accident policy rather than workers comp, then don't complain about it after you take the job or if the IRS comes knocking on your door because you failed to pay your taxes.

[chris1]

The burden to classify an "employee" correctly is on the employer,not the employee.

[Mackman]

Its also hard when you are trying to run a legal company and paying a driver on a W2/with worker comp. Vs a fly by night outfit thats 1099 drivers.

[chris1]

Originally Posted by Mackman

Its also hard when you are trying to run a legal company and paying a driver on a W2/with worker comp. Vs a fly by night outfit thats 1099 drivers.

And that is the crux of it.

[GMAN]

Originally Posted by Mackman

Its also hard when you are trying to run a legal company and paying a driver on a W2/with worker comp. Vs a fly by night outfit thats 1099 drivers.

If you consider a carrier that pays on a 1099 a fly by night company, you will need to call some of the largest carriers in the industry fly by night. Everyone who owns trucks and hires drivers has a problem with turnover, whether you pay on a 1099 or W2. Most carriers that I am familiar who pay or offer a 1099, pay a higher rate to the driver since they will be responsible for paying their own taxes. I am not going to say one is better than another for all carriers, although I would still like to see everyone be responsible for paying their own taxes. It doesn't seem real that you are paying your own taxes when someone else takes the money from your check before you receive it. When you have to sit down and actually write a check for your own taxes, it becomes very real. Working on a 1099 works for a lot of people.

[chris1]

Some of the largest carriers pay employee's by 1099? Care to name a couple? They pay 1099 to the O/O's & LP who actually have skin in the game,not to the employee's. Again it's just a ruse to avoid paying employer related costs.