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What Can Misclassifying Employees Cost You?

CMMA Blog

The legal battle over which workers can be classified as independent contractors versus employees is nowhere near close to over. Wherever the battles land, one important fact remains: The IRS takes the practice of hiring independent contractors very seriously. That means companies should, too.

Misclassification Costs Businesses Money

While hiring an independent contractor is attractive for the potential money savings that come with outsourcing work that is not central to their main line of business, mistakes can quickly override any savings.

The IRS has very strict guidelines that define true business-to-business relationships.These guidelines are meant to prevent firms from misclassifying would-be employees, thereby avoiding a bounty of state and federal taxes. Making a misstep can be costly—whether it was intentional or not.

There is big-time tax money at stake. According to the court’s ruling on the landmark worker classification Dynamex decision, “the misclassification of workers as independent contractors rather than employees is a very serious problem, depriving federal and state governments of billions of dollars in tax revenue.” That’s billions with a B.

Small businesses can avoid certain taxes with fewer employees and independent contractors can write off business expenses and may also underreport their income. Hence the resulting “deprivation.” The IRS is motivated to recoup those lost dollars.

Misclassification Wastes Time

Audits and court costs alone are expensive and time-consuming even for businesses that do everything by the book. If you’re found in error, back pay adds up quickly. How much are you willing to pay in time and hassle alone?

Save the Hassle

If you have any questions about independent contractor status, trust PayReel to help you make the determination. We screen each employment situation carefully to assess the entire e relationship to make sure you are in complete compliance. 

PayReel and sister company Crew Connection have a 40 combined years of experience helping companies navigate the complex issue of compliance and working with independent contractors.  Call us at 303.526.4900 or email info@payreel.com.

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Lessons Learned, Looking Ahead After a Most Disruptive Year

CMMA Blog

I sat down recently with Eric Grau, Head of the Asset Management Department at Joyce Meyer Ministry, to learn more about their workflow, and what changes and best practices he had to share after a ‘most disruptive year.’ 

The team at Joyce Meyer Ministry is an example of just how complex and deep continuous content production has become today – producing a seven day a week TV, radio, and online show in over 100 languages, all while delivering a constant mix of global live event and conference coverage, short film production, and of course, all content needed for online and print production. 

To produce all that content with tight, daily deadlines requires a tight-knit, collaborative team of editors, producers, writers, sound and motion graphic artists all working together on over a half a petabyte StorNext  high-performance, shared file system environment. 

Yet in March 2020 with COVID rampant, it became clear that most of the large production team had to suddenly work remotely. While nothing could replace the need for simultaneous, multi-stream editing that a StorNext environment provides, the team realized they could extend it offsite – while keeping the production and content tracked throughout. The team rallied around a core team of essential on-site editors working on the largest, multi-stream 4K projects, while the offsite team shuttled sound and motion graphic edits back and forth. Everyone learned that they could keep production going, content flowing, adapt to change along the way, and if fact, make them better prepared for new challenges and even more focused on their mission. 

Here are Eric’s Top 5 Lessons Learned: 

Think in terms of workflow first. 

“It may sound easy to just setup storage everyone can access – it’s really about workflows and files.” By focusing on the workflow needed to meet production, the team was able to keep both critical, high-speed editing moving, while pulling in graphics and sound edits for final delivery – and content moving from ingest through production to archive for later use. 

Keep every bit of content you can. 

“It’s a best practice to archive everything we can – it’s easy to store inexpensively and tap into for future projects – there’s no reason not.” The secret to the team’s efficiency is blending high-speed editing with an ever expanding, readily accessible content archive – all on the same platform. When content is needed, it can be seamlessly brought back for new projects. 

3-2-1 works for content archive too. 

In fact, content is so important the team follows the trusted backup mantra of keeping multiple copies – with at least one copy off-site including on-site tape, cloud, and periodic off-site tape sets. 

Every test is an opportunity to learn. 

“Suddenly having to adapt to our team working remote was a challenge – but our team pulled together.” By focusing on the workflow and rallying as a team to figure out how to work with remote specialists – the team learned new skills, adapted to uncertainty with a positive ‘can-do’ attitude and actually saw productivity go up. 

Coming Back Stronger 

“By pulling together and figuring out how to deliver even in challenging times – our team, and our community is stronger.” After a year of disruption, yet still delivering content for the community they serve – the team is all the more focused on solving challenges as a team, working flexibly, and resolved to come back stronger. 

Watch Talk Series Session 

Watch their recent talk with Quantum about successful production workflows as part of our ‘House of Worship Talk Series’ on-demand here .  

To view our Partner blog, click here

How Apprenticeships May Be the Key to Your Talent Problem

CMMA Blog

It’s easy to think about apprenticeships as a relic of bygone years for cobblers and philosophers. But it does have a place in today’s world, albeit with a modern understanding and application. An apprenticeship is “a position as an apprentice : an arrangement in which someone learns an art, trade, or job under another.” Historically, apprenticeships have been a backbone of society as chefs and builders and craftspeople passed on vital skills and trades to younger generations. As skills that were necessary for the survival of their families or civilizations, the stakes were high. Students often lived with their masters for years before they were considered worthy of taking over the craft and practicing on their own. The title of a “master” was hard won. For a modern apprenticeship story, please do yourself a favor and watch Jiro Dreams of Sushi.

Today, apprenticeship is simply a formal, organized system of On-The-Job Training (OJT) with the eventual goal of training a worker to the point of competency. An apprenticeship is decidedly different from an internship in a few key ways.

What’s the difference between apprenticeship and internship?

Internships offer temporary, usually short-term roles, often in exchange for college credit. Along with many people’s lived experiences, movies like The Devil Wears Prada have given internships a bad rap as a place where unpaid, under-appreciated, and usually very young workers are likely to do entry-level work. They may or may not have a designated mentor.

Apprenticeship programs, on the other hand, are paid programs that teach skills for specific industries. Training is usually done in a combination of classroom instruction and on-the-job training. Apprentices work closely with a mentor and upon completion of the program, the majority of workers who complete an apprenticeship program go on to retain employment.

What types of apprenticeship programs does the DOL support?

The US Department of Labor approves A Registered Apprenticeship Program hat has been validated by the DOL or State Apprenticeship Agency as well as an Industry-Recognized Apprenticeship Program, which is recognized by a Standards Recognition Entity in accordance with the DOL’s standards.

Apprenticeships can make filling the talent gap so much easier and more effective by:

  • Allowing you to recruit diverse workers
  • Improving your productivity
  • Reducing turnover and improving company culture

Are there financial benefits?

Well yes, as it turns out. In addition to the likelihood of training and hiring solid workers, the US Department of Labor has about $87.5 million in grants available for qualifying apprenticeship programs. Up to $40 million of those funds will be awarded to states that implement required diversity, equity and inclusion efforts.

What organizations benefit from apprenticeships?

Union trade organizations are well established in the apprenticeship world while the IT, healthcare, and insurance sectors are relative newcomers. Many organizations are expanding and seeking ways to bolster their talent pools for both contingent workers and direct employees. These programs can benefit everyone, including HR and contingent workforce managers. Apprenticeship isn’t just for skilled trades and union jobs, it can work for many types of roles. Look for ways to educate workers while providing ORJ training and you could score big on the talent front as well as from government funded programs. Check out the DOJ information here and see what it might be able to do for your company.

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The Counterintuitive Policy That Saves Businesses Big Money

CMMA Blog

For small businesses, cash flow is king, queen, and the American dream. While big businesses’ budgets tend to be a little more forgiving, small businesses and contractors have much less room to handle delayed payments or unexpected expenses. That’s in the best of times. Throw a little thing like a pandemic into the mix and small businesses can find themselves reeling, especially when multiple clients are delaying bills all at once.

Many companies have shifted even more toward hiring contractors instead of full-time employees. The businesses that treat them right create a win/win.

When you pay contractors quickly, they’re more likely to answer your calls and ramp up your projects quickly. For busy department heads with big projects and short turnaround times, there’s nothing better than diving right in with tried and true creative partners. Saving time, money, and hassle by working with people who just get what you’re looking for is priceless.

Pay contractors quickly or risk losing them

Internal processes, red tape, and backlogged accounting departments make it hard to get checks in the mail. We definitely understand. Unfortunately, your corporate freelance payment policy might prevent you from working with the best people. Top contractors get booked quickly. Paying them later than your competition can get you blacklisted or moved to the bottom of their long to do list.

Put yourself in their shoes. Freelancers are single-handedly juggling creative work, billing, marketing, and more. That means the person who sees your invoice in their red column is the same one you’re expecting to bring their all to your next project. What seems like a small invoice to a big company can have a major effect on a small business’ cash flow. Net 90 is a common practice for large companies. But even though a lot of people do it, that doesn’t justify the shady practice.

Systems, Systems, Systems!

Paying contractors quickly is worth the investment. If it’s not feasible to transform your internal process, get a partner with rock solid systems in place. Your contractors will get paid quickly and accurately and you’ll get peace of mind knowing that you’ll always be in good standing with them. With PayReel, you also get the bonus of pre-vetted workers who are always available at a moment’s notice.

Hiring contractors is a beautiful thing: It gives you a fresh perspective and talent without having to bring on full-time team members. Just make sure you do it right. Going from Net 90 to Net Now will save you time, keep you in good standing with contractors, and ensure you can feel good about the way you do business. Rather than trying to save Benjamins up front, take Benjamin Franklin’s advice and “Wrong none by doing injuries, or omitting the benefits that are your duty.”

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