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  1. #1
    Join Date
    Feb 2018
    Posts
    1

    Default Misclassified by Employer As a 1099 Independent Contractor

    My question involves independent contractors in the state of: Florida

    So I am 3 weeks into a sales position. I'm still in training, set up as a 1099, working M-F, 9-5. I get an hourly wage for that. When I am out of training, I'll be receiving 10% commission on sales and a $400 weekly draw against commission (not money I get to keep), which I would rather not even have. The set up does not seem right though. The other two sales people make their own hours and only come in as needed. They are also 1099.

    I am expected to work in the office 40 hours a week (per my boss), or at least when not out trying to get business and at clients' homes. The owner of the company said I should not be in the office, and instead out trying to get news sales. But if I don't have many appointments that day, I can only drive around and market for so long. My Sr. sales rep, who does not have a draw, said the reason I have a regular work schedule is because I have the draw (is that true?) Nearly everything about my job points to employee. Set hours, a desk and computer in the office, requirement to use the company van, etc. Thoughts?

    I've tried contacting the DOL Wage and Hour division but can never get through to anyone. I tried calling a lawyer yesterday, but it turned out to be a conflict of interest because my employer apparently uses the same lawyer. I just feel like I'm set up to get screwed. Also, the Sr. Sales rep who has been training me, calls the shots on territory. He told me at the interview that he was bringing me on so he could retire, but then I find out that he isn't leaving for 1-2 years. When I asked what I should expect to make on commission, he showed me his monthly sales sheet to give me an idea. Well, he has given me an area in which the business gets very little sales calls from, but may throw me a small bone in his area if he doesn't want to deal with it. Not sure what I have gotten myself into.

  2. #2
    Join Date
    Mar 2013
    Posts
    16,859

    Default Re: Misclassified Hired As 1099, Something is Not Right About This

    You appear to be a "statutory non-employee" according to the IRS.

    See Pages 6 and 7 of Publication 15-A Employer's Supplemental Tax Guide:

    https://www.irs.gov/pub/irs-pdf/p15a.pdf

    If your job meets those conditions then you are properly classified as a 1099 employee as you are essentially self-employed.

    If that is the case you need to start studying all you can about filing Self Employment taxes which include Schedule C, Schedule SE, and possibly paying estimated taxes during the year.

    See the IRS Self-Employed Individuals Tax Center:

    https://www.irs.gov/businesses/small...als-tax-center

    Start planning now so you don't end up with a big surprise tax bill and penalties.

    If you don't want or need the draw, decline it and work on straight commission so you can spend your time selling. Make sure you have a written commission contract and understand it.

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