Everyone wants reliable employees who show up on time, keep customers happy, and know what it takes to get the jobs done. Most of the time, technicians will be interacting with customers unsupervised, which means that every time your team members step into a customer’s home, there’s potential for a lot of liability. It’s becoming increasingly difficult to find employees you can trust and count on, so it’s important to utilize background checks for vetting potential candidates.
You may want to utilize private databases and 3rd party directories to run your own background checks, but we would highly discourage this as it is illegal. Many states have very strict guidelines around data privacy and collection, making it illegal to request certain types of information. It may seem like a way to save time and money, but in reality, you’re going to expose yourself to more liability and waste more time than you would by letting your background checks be handled at the county, state, or federal level.
In addition, you’ll want to check the validity of your candidate’s licensing, like their trade license and driver’s license – especially if they plan to use company vehicles.
It may be tempting to lower your payroll expenses and tax liabilities, but employee misclassification is actually a serious crime that can cost you thousands of dollars in penalties and FICA back-taxes. Thankfully, it’s pretty easy to figure out whether you’ll need to classify someone as a contractor or employee, but the line may not be as clear in a service business setting. Generally, the way someone works dictates their employment status, but this can be influenced by factors such as scheduling and provided equipment.
If you can tell your worker when, where, and how they should work, this is referred to as ‘behavior control’ and they’ll need to be classified as an employee. Independent contractors, however, are their own business entities because they control the when, where, and how of their work. This may sound simple, but things can get muddy quickly when you start to look at real-life situations.
If you run a pool cleaning business, and your workers use their own cars to drive to each location, but they use specific supplies and uniforms that you’ve specified, are they considered employees or contractors? They’re given specific directions, but you’re not directly monitoring or managing them. Be sure to do your research to avoid misclassifying your workers.