Question for those who are employees or those that have them

[Ray B]

What is your arrangement with the owner of the shop you work at? How do you get paid? Do you only get paid if you do a massage or are you guanteed a certain amount per hour? Do you get sent home often if there is no work? Does your employer guarantee you a minimum rate per hour? Is everything you need to do your job provided for you? Do you have to do extra duties such as cleaning, laundry, etc...?

I ask because eventually I will be hiring someone. I am not sure just when... could be 6 months could be 12. I am trying to develop a good fair and legal game plan.


TIA

 

[leftyL]

Where I work we get paid either 50 or 55% depending on how long you've been there. We're paid every-other week (used to be every week but switched years ago so payroll only had to be done half as often) and the employer takes care of all taxes. There is a guaranteed minimum but to be honest, I don't remember what that is. In the 15yrs that this owner has had the clinic, no one has ever had to be paid the minimum. It is helpful psychologically speaking to have a minimum set so when you hire new therapists they know that they have a safety net.

We get paid vacations, paid holidays and depending on how long you've been there, paid CEU's, paid licensing fees, paid liability insurance and extra bonuses.

We expect our employees to be available their entire shift. We don't take walk-ins (unless they are an established client) because of the "perv" factor but it's not unusual for someone to call and want to get in within the next few hours. There are days when you walk in and only have 1 client scheduled and end up doing 4-5 massages that day. Obviously everyone gets a lunch break and if you're scheduled to work till 4pm and it's 2:45 and you don't have a 3pm scheduled you can leave.

Everything is provided for us....lotions, linens, music, business cards, etc..... If a therapist wants to have the little "extras" (essential oils, biofreeze.....) then they pay for that themselves. We have it set up so that all the therapist has to do is show up, do their massage and charting and then go home.

We have a receptionist who is responsible for laundry getting done but all the therapists pitch in and help her (always good to stay on the good side of the receptionist.) We have a cleaning company to do general cleaning but everyone is supposed to clean up after themselves (wash their own dishes, clean up their spills etc)

We expect a lot from our therapists as far as qualilty of their massages, we're very picky as to who we'll hire in that respect. We never tell a therapist how to do their massages, we're all different and that's one of our selling points. If you don't like one of our therapists, then try a different one. We're all good, just different.

We do sign a non-compete but it doesn't in any way restrict where or when you can work, it only protects our clients. The business invests a lot of money to bring the clients in. If a therapist brings in any clients on their own, then those clients are excluded from the non-compete.

Years ago, the owner realized that the therapists were her biggest asset. She treats us well so we'll stay there a long time. I've been there over 14 yrs, we have another therapist who is approaching that mark, another one who's been there over 12 yrs, another over 10 yrs, another over 6 yrs. Clients like stability, they like to know that they don't have to switch therapists frequently.

Treat your therapists well, provide them with all they need (including clients to keep them busy) and it will be a great venture!

Good luck,
Angie

 

[Balasubrahmanyam]

Depends...

Do you really mean you will be hiring an employee and not just taking on a contractor?

If it is an employee, then there are just a few basic guidelines you have to follow:

1) No more than 40 hours a week on the schedule (not 40 hours of work, 40 hours they have to be at your establishment)

2) Pay minimum wage for the work they do

3) Display all of the employer-required postings your state labor board will give you.

Please do not mis-interpret #2 into thinking you have to pay an employee an hourly rate. You don't. They can sit all day and have no clients and you owe them nothing, if you structure your pay as 100% commission.

But even on 100% commission, if they have few clients for the pay period, you have to pay them at least "hours on premises" x MW.

You can require them to fold towels, clean up, and other basic duties as part of earning the commission/fee per service they agree to.

 

[DancerForLife<3]

I plan on providing all the supplies needed. I have a linen service for sheets, but wash small stuff on my own. I would expect a therapist to do some of the general cleaning in the office (vacuuming, general clean up after a massage, dusting, folding laundry, answering the phone, etc...) , in my mind it is an extension of their work even if it is delayed. I would never ask someone to do something I wouldnt do myself.

If there is nothing scheduled for the day, I wouldnt expect the therapist to come in to work that day. I wouldnt expect them to hang around their whole shift if they only have one or two sessions booked. If they want to hang around in case a walk in comes by that would be fine too.

I would expect them to perform all the different types of massages I have in my brochure. All of my services safely fall into the caeforum.xxxory of massage.

I would do all the marketing for them, provide all literature, paperwork, business cards, everything.

Perhaps what I am looking for isnt an employee?? I have heard so many horror stories about indies who were treated like employees that I just thought I would elimate that from happening and just start with employees.

I dont want someone saying, "I dont want to do this or that, I dont like touching feet, I wont work on male clients, etc..." Which in my thinking (I could be wrong) an indie could do but an employee couldnt (unless they wanted to get fired.)

Please correct me if I am wrong!

 

[Pompal 09.]

Sounds like you want employees.

But don't pay them more than 40%.

As an employer, you have to pay

6.7% FICA
2.1 % FUTA
2-5% state unemployment tax - which in a tax happy state like WI is probably closer to 5%

Workers Compensation coverage - usually about 4-5%

And this is just your tax burden. Then if you offer vacation or sick days, those can be another 5%.

Plus, you can't be an evil exploiter of your fellow man by not offering health insurance to your employees (after all they do all the work

 

[Ryan]

40%?? only 40%?? Is this the norm??

 

[Abbey loves Jesus]

You decide what the norm is.

Most spas that have employees pay less than 50%.

If you are a dollar short or a day late with your monthly deposits of Federal Withholding tax or your FICA $, you have to pay 20% penalty on the ENTIRE AMOUNT - that is your risk by being an employer.

Every month you have to file and deposit state with holding, federal withholding / FICA and federal unemployment tax contributions. Every quarter you have to file state unemployment tax contributions, plus your quarterly Federal and state tax reports. Forget to file, you get fined.

My point is, it is not worth it to have employees paid 50% commission, with you paying for all of those taxes, benefits etc.

50% commission
15% employer tax burden & benefits
10% Adv. & Promo.
+ linens
+ rent
+ utils
+ CC processing costs

There will be nothing left for you at the end of the day.

The "norm" is to avoid going broke.

FYI - Ritz Carlton spas pay about $10 per hour and 15% commission, plus 15 out of the 20% gratuity. Average service is $110 per hour.

So they are paying the equivalent of 25 - 30% commision on services, plus benefits, and this is with a whole finance department handling all of the administrative burden of filing the employment taxes.

IC's might get 50% commission, but not employees.

 

[dheyenne]

I did a websearch & found some articles that might help you with your decision on IC vs. Employee:

http://www.massagetherapy.com/articles/index.php/article_id/454

http://www.ucmtcareerservices.com/resources/private_practice/Independent_Contractor.doc

 

[Sudmeister]

IC's might get 50% commission, but not employees.

Not true.

I'm an employee and I get 55%. My employer pays all taxes and expenses and still has money left over for the clinic to be profittable. Maybe not "rollin in the dough" profit but certainly enough to make it worth her while. My employer is a CPA so trust me.....if it wasn't making money, she wouldn't own it.

Angie

 

[h m]

Nothing is absolute.

Good for you.

CPA just means she knows what columns to put the numbers in.

It all depends on how much you want to make and how important a role your employees make in your business plan.

55% commissions means your CPA aint making much. You just can't change the math