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Hiring someone for part-time or hourly work?

skateskate subscriber Posts: 2
edited June 2009 in Business Planning
Hello,
I am in the process of starting a sole-proprietorship business. This will be an online retail company. I need someone to take care of order processing and shipping out the items. I have a friend who is interested. Do I need an Employer (tax) Identification Number to hire someone for part time/hourly work? And are there any insurance/liability issues I need to take care of? I can ask my friend to either come to my place and do the fulfillment work. Or I can drop off the stuff at his place (once a week/month) so he can do the work out of his home. Whichever makes the process easier. (I willing to take the risk if something goes bad my friend is not going to sue me. I am not worried about that.)
Thanksskate6/17/2009 2:23 PM
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    profitizerprofitizer subscriber Posts: 16 Bronze Level Member
    Hello.
    I usually leave the `legal` stuff to others.
    Without getting into details at this point, you`d mentioned that you`re
    starting an online business, yet you are still using 20th century operations principles
    (mindset) --
    ...I can ask my friend to either come to my place and do the fulfillment work. Or I can drop off the stuff at his place (once a week/month) so he can do the work out of his home. Whichever makes the process easier. (I willing to take the risk if something goes bad my friend is not going to sue me. I am not worried about that.)

    IMHO, if I were in your situation, knowing what I know, I`d utilize 21st century business development principles whereby initially, your friend gets paid `piece work` wages working from their home and maybe with some additional incentive. 
    What I mean is, I`d set up a virtual system whereby you both are notified via E-mail when orders come in as that is when your friend`s work really begins.  If there are no orders, why pay someone to do nothing?
    When your system is setup using the right software(s) and fulfillment process, the majority of the data is digitally stored and accessible to you in `real time` anytime you want it even if your friend needs to add data to it.  How to do this exactly requires additional info and then a plan, but at least maybe this will give you something to ponder.
    HTH
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    nevadasculnevadascul subscriber Posts: 3 Member
    Your friend can function as an independent contractor paid by the piece.  But, be careful.  The IRS has a list of 20 criteria that you need to review.  The list is used to determine if someone is an employee or independent contractor.  You can use any number of search phrases such as "determining employee status" or "independent contractor status" to find this list.
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    skateskate subscriber Posts: 2
    I was out of town last week. Thanks for your replies. Please let me re-phrase the question.
    I want to hire a worker to take care of the shipping process. What can I do to make sure he will be classified as a contractor?
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    nevadasculnevadascul subscriber Posts: 3 Member
    Here is the link to the IRS that should answer your questions.  Pay particular attention to the employee classifications.http://www.irs.gov/businesses/small/art ... 21,00.html
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