Hey so I work as a cashier at a small owned restaurant I will admit business has been slow so my boss has been looking for help. These new investors want to get rid of some of the workers there and only keep some and we still don’t know who is being let go until Friday. I would like to know if her and the new investors are able to make us “independent contractors” if we’re cashiers, dishwashers, and meat cutters? Please if anyone can help I strongly believe these new investors are trying to take advantage of us and my boss is just going to let it happen.
My boss has new investors in the restaurant and said we will receive 1099 and it’s effective immediately
byu/redswack77 intax
Posted by redswack77
18 Comments
[About Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding | Internal Revenue Service](https://www.irs.gov/forms-pubs/about-form-ss-8)
Yes, they are taking advantage of you
Sure, they can make you independent contractors but they’re breaking the law
You could report them, but expect/prepare you lose your job. I surely would, but I’m not in your shoes and wouldn’t blame you if you didn’t
You are either a 1099 contractor or you are a W2 employee. The boss doesn’t just get to decide. There are laws over the classification. Usually if you have to wear a uniform and the boss sets your schedule you are going to be a W2 employee.
The reason he/she is trying to 1099 you is so he doesn’t have to pay payroll taxes (his half of %15.3).
No, they can’t make you independent contractors if they treat you as employees.
My advice: don’t raise any objections right now, lest you lose your job. After they’ve fired everyone they’re going to fire, if you’re still there, then you can start insisting that you be classified correctly. Meanwhile start looking for a new job.
This is wrong. Complain to your state labor dept, IRS, state tax agency. This is wrong on all levels.
No worker’s comp
No unemployment insurance
paying 100% of FICA.
Not a winning proposition.
No. They cannot make you independent contractors. If they try, report them to the labor board. And start looking for another job.
I have a feeling that a good worker’s rights attorney would have a field day with this one
I’ve seen it where an employee went to the labor board regarding being misclassified. This was in California. Other states may vary. He was deemed an employee and the company had to pay both his and their payroll taxes. Not the Fed or State income tax but all others. He was then issued a W2 for the year. And the next year as employment covered both. And as a bonus, the company was assessed penalties, as obviously, the payroll taxes were not paid on time. The investors must be ignorant. Ditto for the boss.
I’ve seen it happen twice.
Sounds like now you get to set your own hours and do things how you want to do them since you are no longer a w-2.
Looks like I’d be finding a different job as that’s not a realistic way to run that kind of business.
I’d just start looking now. The restaurant you are working at has no future. The whole lot has no idea what they are doing. You are not a 1099 person.
No, you cannot be 1099 if you have scheduled hours
No, as long as they set your hours and where you work, you are employees.
Nope, something as simple as “Do they provide you instructions to do your job?” is enough for most people to know you are an employee. They are trying to not pay a lot of burdens associated with having employees. All legitimate companies face the same burdens. I also recommend not saying anything right now, but get the word out you are looking for new employment.
https://www.irs.gov/newsroom/worker-classification-101-employee-or-independent-contractor
When they get caught they will have to pay. Employers who misclassify employees as independent contractors in California can face penalties including hefty civil fines of $5,000 to $25,000 per violation for willful misclassification, plus a share of the unpaid minimum wage, overtime, and unreimbursed business expenses. They are also subject to federal penalties for unpaid payroll taxes, interest, and potential IRS audits, along with criminal charges in cases of intentional misclassification. Additionally, misclassified workers can file PAGA lawsuits to recover penalties and back pay for their former employers.
I think you’d be misclassified as an independent contractor. The employer can be assessed heavy penalties. Here’s a good link to peruse.
https://www.dol.gov/agencies/whd/flsa/misclassification
If you’re willing to be fired you can lodge a complaint but won’t be compensated more than statutory wage rate for restaurants. But if you’re happy getting tips and you get your fair share you will be required to pay both employer and employee share of what’s your reported income. And as pointed out you won’t qualify for workmen’s compensation if you’re injured on the job. If they receive your tip as gross proceeds they have to pay the corresponding FICA/MED out of their pocket and that amount is not predictable. And if your tip is included in the bill and they pay a transaction fee ditto. (Not so if the customer pays the fee).
Maybe you just need to sit down and talk about it and work something out.
There’s no such thing as an independent contractor restaurant cashier. I suggest you find another job because this place won’t be in business for long.
I worked for a national know company and
In CA some of the workers were classified as 1099 after couple of years they were hit with large amount of fine and they had to go back and classify all workers as w2 from the hire date. plus all the over time A huge settlement It is worth it to notify the IRS and the labor board in your state