How To Guard Against Wage Theft Lawsuits
Observers used the words “game changing” and “broad ramifications” when the Ninth Circuit Court of Appeals recently issued its ruling in a case that pitted the delivery giant FedEx against some 2,300 drivers on the West Coast. The case centered around FedEx’s classifying the drivers as independent contractors rather than company employees. The appeals court sided with the drivers because FedEx maintained controls over the drivers’ appearance, vehicles, hours and conduct just as a business would over regular employees. Increased litigation The case is an example of “wage theft lawsuits,” which have certainly been on the rise in recent years. In the FedEx case, by classifying drivers as independent contractors, the delivery company was able to duck overtime pay and other benefits that would have been given to a regular employee. Abusing the “independent contractor” classification is probably a fairly common occurrence. Don’t fall into that trap. It can be a costly mistake. Among the typical attributes of a true independent contractor are: Sets his or her own hours and schedule, Usually works for more than one company, Works independently, Works from his or her own office or home, and Pays the costs of getting the job (contract) completed. If you have “independent contractors” who don’t sound like the people I’ve described in those five bullet points, you need to get legal advice and see if you should bring them onboard as employees or readjust your relationship to them. Other areas to watch There are other ways you can find yourself on the wrong side of a wage theft lawsuit. First, make sure you understand federal and state laws regarding overtime. If you’re allowing – or scheduling – employees to work hours that push them into overtime pay situations, be certain you are compensating them properly. Also, be a stickler about time cards. You don’t allow other employees to punch coworkers in and out, don’t allow management to change time cards to skirt overtime regulations. Also, never ask an employee to sign a blank timecard. In the same way, know the law regarding breaks – both rest breaks and meal breaks – and adhere to it. Wal-Mart was fined $187 million because it was found to have cut rest and meal breaks. Sometimes in the small business environment, owners, managers and line-level employees develop close relationships that almost resemble friendships. Friends will ask “favors” of friends and in the workplace that may translate to stretching some labor laws. Don’t allow yourself or your managers to fall into that trap. It can come back to hurt you in a major way. Not only can it cost you money, it can tarnish your reputation in your...
read moreReady for Your First Employee?
Small businesses usually start-off as a one-man show. When you are the owner you do everything from emptying the trash to collecting the cash. As your business grows, however, it can reach a point where the volume of work is overwhelming. That’s not a bad thing in terms of your business success, but it can cause you to become stressed out and burned out. There are only 24 hours in every day and there’s only so much one person can accomplish. Reaching this point in your entrepreneurial journey is a pivotal moment. It’s the proverbial fork in the road. The direction you choose will have a lasting impact on your business. You recognize the need for additional manpower to manage the business but the thought of committing to more overhead is scary. However, you also realize if you don’t add additional resources then you’ll stagnate at your current level of business. It’s a catch 22 in many respects. So how do you know what to do? When is the right time to hire your first employee? The answer: When the business is ready. When you are ready. And when adding employees is in strategic alignment with your vision for the business. First, review your business goals. If you desire to build a sustainable business enterprise, then it is going to take more than one set of hands to get you to that point. My theory about adding employees is what I call the MYTOP theory. MYTOP stands for multiply yourself through other people. Your first employee should be someone who complements your skill set so you can focus more of your time and energy on the things that you do well and add the most value to your business. So step number one before you hire anyone is to analyze your strengths and weaknesses. Next, remember to hire smart, not fast. Clearly identify your business needs. That means you need to write a job description. Yes, I realize this is tough because you’ve never had anyone work for you before so how do you really know what the job is going to entail. Now is the time to figure it out. It’s important for you to define your expectations so you can identify the right candidate. It’s also important for your employee. Without established expectations the chances of failure are great. Not to mention the frustration it can cause for both of you. Determine your salary range for the new position. Committing to a salary is the scary part. Recognize when you hire someone, in order to get the type of individual you need to help you grow your business, you may have to take a salary cut yourself. In fact, many entrepreneurs find they have to miss a paycheck here in and there in order to make sure their employees or paid. Are you ready to make that commitment? It’s another form of making a financial investment in your business. However, if you choose wisely the rewards are worth it because two people can accomplish more than one. Finally, avoid hiring family and friends. I would venture to say 90 percent of the time hiring a friend or a family members ends in a disaster. When things go awry, good, long-term friendships are destroyed and family gatherings tur...
read moreShould You Put Your Money On Apple Pay?
Are we about to see a cage fight to the death, like we saw in the Blu-ray vs HD DVD battle for supremacy, or will there be peaceful coexistence as the Visa vs MasterCard saga played out may years ago? That’s the question we’re asking today as we reflect on the announcement that Apple will include a payment system with its new iPhone and iOS. The Silicon Valley giant said that it has already forged partnerships with some 22,000 retailers. However, by the time all the Apple aficionados had filed out of Flint Center, Wal-Mart and Best Buy were summoning the press to say, “Not so fast Apple, we’re hitching our carts to a different horse—CurrentC.” Continue with cards? CurrentC is an app. Consumers load value onto it or hook it up to their bank accounts and use it at retailers who have adopted the system. It is also designed to handle things such as store discount coupons. Apple Pay, on the other hand, is a system that stores the credit and debit cards you already own. American Express, MasterCard and Visa along with every major bank have signed on to Apple Pay. CurrentC, which is being Beta tested right now, creates QR (quick response) codes while Apple Pay uses near field communication to send data to properly equipped terminals. Apple Pay is supposed to debut in October. On the face of it, is seems that Apple Pay has the potential to be more convenient for consumers because it uses their existing credit cards. Also, its security technology is somewhat superior. However, many brick-and-mortar stores will have to invest in new terminals. Current Cost advantage Also, the company behind CurrentC, MCX, is touting its lower cost to merchants when compared to credit card purchases. Plus, Apple will get 15 cents for every $100 transaction made using its system; merchants have to pay that. This is in addition to the credit/debit card fees banks and processors charge. Apple will also be working hard to garner acceptance of its payment system online. It will significantly increase security in the e-commerce world. That fact, along with Apple’s substantial influence, will probably cause it to be adopted rather quickly online. Since everything in the web realm happens quickly, I expect we’ll know fairly soon if there will be a dominant new “secure” payment system. Unless you’re an online retailer, I suggest you sit back for a little while and see how this plays out. E-commerce sites should implement Apple Pay as quickly as is convenient—Apple users are big online spenders and the holiday shopping season is almost here. Image: “Apple Campus One Infinite Loop Sign” by Joe Ravi (Shutterstock iStock Dreamstime) – Own work. Licensed under Creative Commons Attribution-Share Alike 3.0 via Wikimedia...
read moreBe Ready For The New American Household
For the first time ever, there are more single adults than married adults in the United States. That has huge implications for our society, and since small businesses are a major component of our society, this shifting demographic – one of many, by the way – should be carefully considered when mapping out future business plans. Some differences are pretty obvious. Singles are more likely to rent than own their own homes. Singles are also less likely to have children. By the way, it seems to me that married couples are also less likely to have children today, and certainly they have smaller families. How time is spent Those basic facts will impact business trends greatly in coming years, but there are more. Back in 2003, the Bureau of Labor Statistics (BLS) studied different habits between single and married adults. Outlined below are some of the findings. Here are some areas where married people spend more time when compared to singles: Household activities. Two hours and four minutes each day versus one hour and 24 minutes. Buying things. 47 minutes a day versus 40 minutes. Religious and civic activities. 23 minutes a day versus 16 minutes. Here are some areas where single people spend more time each day when compared to marrieds: Educational activities. 56 minutes a day versus five minutes. Personal care (includes sleep). Nine hours 47 minutes versus nine hours and 13 minutes. Socializing, sports and leisure activities. Five hours and 48 minutes versus four hours and 57 minutes. The numbers that really jump out are the areas where singles invest more of their time. I would factor out about eight hours of sleep time for both groups and when that’s done, education, personal care and social activities rate much more highly for singles than married people. How money is spent More recently, the BLS looked at 20-somethings, both married and single and how they spend their money. Singles spend more on food, alcohol, housing, clothing, and education. Married people generally spend more on transportation, health care, entertainment, and personal insurance and pensions. As the number of single adults continues its climb, strengthening its position of dominance, small business owners need to recognize this as a growth group and plan future expansion and marketing with this in mind. For example, in real estate, planning an apartment building could be wiser than planning a condominium development. And because “household activities” includes cleaning and cooking, we will see even more growth in home cleaning and cooking services. By the way, looking a earnings figures of single versus married people in their 20s, while marrieds have an advantage in their younger years, by age 29, the groups are almost the same. That creates some good marketing opportunities for business. Image: “Adv of Ozzie and Harriet Nelson Family 1952” by Press materials are presumed to have been distributed by the ABC Television Network, which was the network that aired the series. Licensed under Public domain via Wikimedia...
read moreBe Ready for Another Short Holiday Shopping Season
While spring may be the time when “a young man’s fancy lightly turns to thoughts of love,” fall is when the concerns of many small business owners turn to the holiday shopping season. Here’s a roundup to help you put Holiday Shopping 2014 into perspective and get positioned for success. Shopping season I recently retweeted a graphic that had a picture of Will Farrell in the movie “Elf” jumping up and down and it said there were only15 Fridays left until Christmas, which, by the way falls on a Thursday this year. There are fewer than 15 Fridays left now. Flashback time: Remember Holiday Shopping 2013 when the number of days between Thanksgiving and Christmas could be counted on one hand? Okay, I exaggerate, but it was a shortened shopping season last year. Well, I’m here to tell you that retailers have one whole day more this year. In other words: it’s another short shopping season. Perhaps this explains why Costco started selling Christmas paper and other holiday supplies back in July. Remember that a lot of small businesses pick up supplies from Costco, so the warehouse retailer probably had its B2B business in mind when it started shelving red and green items in July. Shoppers’ mood The other variable to consider when trying to forecast and prepare for the holiday shopping season is the mood of the consuming public. Consumer sentiment seems to have been quite variable throughout the year. However, there wasn’t any time when buyers were ecstatic about their finances. If the two extremes are boom and bust, we seem to be stuck somewhere in the middle with little indication of where we’re headed next. However, no matter what our mood is, there will be a holiday shopping season, so small businesses need to be ready. Britt Beemer, chairman of America’s Research Group, recently shared an important piece of information with CNBC’s Krystina Gustafson. Beemer stressed the importance of getting customers through the door on Black Friday. It’s not just about lowering prices to make sales on the day after Thanksgiving, he explained. The stores shoppers visit on Black Friday are also the stores they tend to return to throughout the shopping season. Improve your odds According to America’s Research Group, when customers shop a store’s Black Friday sale, there’s a 70 percent chance they will buy there two to three more times during the season. However, when they skip a store on Black Friday, there’s a 30 percent chance they’ll never hit it during the Christmas season. Black Friday sales are a relationship builder as much as a way to get throngs through the door on that special day. With a short shopping season, it’s easy to see that those two-to-three additional visits are extremely valuable and could be the difference between a good and bad year for...
read moreDigital Nomads: Have Computer and PayPal Account – Will Travel
Jon Morrow, a successful blogger and Internet entrepreneur, once wrote a blog entitled, “How to Quit Your Job, Move to Paradise and Get Paid to Change the World.” You see, Jon was a full-time blogger and one day he realized that he could ply his trade from anywhere he could connect to the Internet. He move to Mazatlan, Mexico and penned that blog from his balcony overlooking the Pacific Ocean. He had joined the global army of digital nomads. I’ve taken you through this scenario because when you hear “the rest of the story” you’ll get a sense for how desperately people want to become digital nomads themselves and you’ll learn how Jon did it. The post I mentioned in the opening went very viral, so viral in fact that it has earned him well over $33,000. It has enabled Jon to teach many others how to do what he does. There are a lot of folks who want that knowledge and are willing to pay for it to the tune of $33K-plus. As freelancing, fully web-based businesses and telecommuting become more popular, the number of digital nomads traveling the globe and working from interesting and sometimes exotic locations is increasing. Freelancing Sites such as Elance, oDesk, Freelancer and Guru have made transitioning to full nomad status fairly simple. Through them, finding and bidding on jobs is much easier and they facilitate the payment process. Professionals from a wide range of industries can find work on these sites. Some of the more in-demand skills are Writing, Web development, IT and programming, Design and Graphics, Administration, Sales and marketing, Legal, and Finance and management. Teaching Teachers can sometimes establish themselves in the digital nomad world. As colleges and universities add more online courses, the professors who teach these courses can sometimes be located anywhere. They pick up assignments and communicate with students over the internet. Further, there is a growing number of musicians offering private lessons over the Internet. They communicate with their students using Skype and usually advertise on Craig’s list or through their own websites for new students. eCommerce Some ecommerce businesses don’t require any physical presence, those that sell digital downloads, for example. In these cases, the owner can generally be located anywhere. Additionally, with fulfillment houses and drop shipping, even if you’re selling a traditional product, it may be possible to travel and still have the means to successfully manage your business. Blogging There are a number of professional travel bloggers who are always exploring new places. However, making enough money through blogs alone is very difficult. Anyone who has started a blog and loaded it up with Adsense ads, knows that the path to profits is long and difficult. As Jon Morrow found, selling something that is promoted by your blog is the real way to “monetize” it. If you are good at something, write about that and build your following. When you have some authority, then start teaching others what you know. Find the right employer Some digital nomads evolve from their day jobs. If you essentially have a job that adapts itself to telecommuting, you’re just one step away from living the nomad life—all you need is clout and an employer who can see the big picture. The key is to make yourself...
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