Independent Contractor v Employee

Many of us in the pet care industry are scrambling to hire right now. The bubble has arrived and the pet businesses who managed to survive the pandemic are coming back strong. My own pet business recorded the highest revenue month in our history in May. This has thrown me into a club that I’m not sure I want to be a member of; the club of many many pet businesses looking to hire from a small pool of available and qualified people.

Even if you’re not part of this club right now, at some point in your life as a professional pet sitter or dog walker you will come to the same question that every other pet care business owner comes to. For some it will come immediately, for others it will come later when the business your nurtured and loved for months or years has brought you to a point of total mental and physical exhaustion and you’re ready to chuck the entire endeavor. That question is really two parts. The first is “Do I hire help or do I continue to be a one person show?”. The second part is, “Do I hire an independent contractor or an employee?”.

We’re going to assume that you’ve made the mental jump to bringing in help to grow your business and possibly preserve your sanity. Good for you! This is the first step toward reclaiming your life and taking your business to the next level! It’s an amazing and scary decision all at the same time and, like most things in life that are worth doing, it’s hard. Take heart though, with some careful research and planning you can make it a successful and rewarding transition.

The first thing you’re going to notice as you start down this road is that there’s lots of information out there on this topic. And by lots, I mean so much that it will bury you so deeply in opinions, strategies, plans, regulations and advice that you may not come up for air for weeks and you will irritate your family and friends by your incessant pondering on what to do, when to do it and how in the world anyone makes this work. Ok, slight exaggeration, but it’s a big decision that will most definitely have benefits and consequences whichever way you decide to go.

Take a deep breath….and remember, there is no wrong decision, just a decision on what works best for you and your business. With any business decision I personally like to look at the big picture first. There are a thousand tactical details behind any decision (which is a topic for a future BLOG) but for now let’s talk a little about what you want for yourself and your business from a high level.

The wonderful thing about a pet care business is it’s unlimited in its scalability. The pet care industry is growing each year, people will continue getting pets and they are treating them more and more like full family members. You’ve already made the decision to hire help, now you need to decide how much help. And I don’t mean how many immediate people, I mean how many in the next 1 year, 5 years, 10 years. I know it’s tough to think that long term but keep in mind, you don’t need to hire all those people tomorrow but it will be helpful to have an idea of where you want the business to be long term. This is important because it should factor into your IC vs employee decision. There are restrictions and regulations around what defines an IC relationship (also a longer topic for a later BLOG) that will impact both your ability to run your business in certain ways and the risk to your business should you be audited by the IRS. The fact is that the government is paying more and more attention to businesses who hire ICs who may not necessarily meet all of the qualifications of an IC relationship. That doesn’t mean you can’t hire an IC for your pet sitting business, it just means you need to be aware of the limitations and the risks.

And that brings me to my second big picture point to consider. How much control and involvement do you want in your business. In the case of independent contractors, you as a business owner do not have the right to control what the worker does and how the worker does the job. You can define the end point, i.e. go to this house and pet sit this dog for this amount of time, but you can’t tell them how to do it. This means you can’t train them in or have any expectation that they follow your company’s policies and procedures. It takes a tremendous amount of trust to work with independent contractors and, while most of them are reliable, caring people, you need to ask yourself if you’re going to be comfortable and able to exhibit that kind of trust. Now, it would be naïve to assume that you’ll never run into issues with employees as well but with employees you will be able to better control the situation through well-defined company policies and training.

The third area to consider is what level of scheduling control you ultimately need and want in your business. By definition an independent contractor can accept or turn down a job. This means that if you take on a new client that wants a particular set of dates and times for visits, your IC can say “no thanks” leaving you scrambling to either find another IC that will take the job or covering the visits yourself. With an employee you can have an expectation that they will take jobs as long as they are within a time period or shift that you and your employee have agreed to previously. Note, that doesn’t mean you should force fit your employees into whatever slot you want to simply because you can. You can, but I assume you also want to keep your employees happy and hanging around for a while, so it’s best to work with them.

It’s easy, as small business owners, to get caught up in the daily details of making a business work. It’s critical though that we step back and take a big picture look at our businesses when making these kinds of decisions. And don’t worry, again there’s no wrong answer and there’s nothing saying that you can change your mind if you’ve gone one direction and decide down the road to go in a different direction. Life is nice that way!

Another great article you might enjoy

How to succeed in your pet business in 2021

https://www.thepetbusinesscoach.dog/how-to-succeed-in-your-pet-business-in-2021/ 

About Eliza

Eliza is the owner of two successful pet related businesses; Preferred Pet Partners, a pet sitting and dog walking company, and The Pet Business Coach, offering coaching and resources to aspiring or current pet related business entrepreneurs. She maintains two awesome blogs. One for pet parents https://preferredpetpartners.com/blog/ and one for pet business owners https://thepetbusinesscoach.dog/blog-page/.  Eliza also supports various animal rescue and shelter organizations. Eliza and her husband have a growing pet family. Visit her websites: www.preferredpetpartners.com or www.thepetbusinesscoach.dog.