The Huddle - Episode 2 - Employee vs Subcontractor
This week Paul Stuart is joined by Jose and Daniel Gonzalez, where they discuss comparing the differences and similarities between being an employee installer vs. a subcontractor installer.
Create your FREE Installer profile at https://gocarrera.com and become part of the future of the industry TODAY!
GET TRAINED! Find a list of training dates here: https://gocarrera.com/resources/training/
The HUDDLE is where the flooring industry can get together and talk about everything! Lead by Paul Stuart from Go Carerra who is joined by Daniel and Jose Gonzalez from Preferred Flooring.
what's up guys welcome to
the huddle it's a weekly discussion
about how to maintain forward progress
in your flooring career
today we're going to be talking about
employee versus subcontractor what's
best for you a quick introduction my
name is paul stewart i'm the founder and
ceo of go carrera and president of
stewart associates flooring company
located in wichita kansas
got daniel and i got jose with me from
preferred flooring what's up guys
hey what's up
how's the day
busy as always
nice flooring right
yeah flooring in life you gotta find
balance
yep
well hey i wanted to open the discussion
with
um
kind of
discussing our individual
uh experiences with the two different
kind of aspects of flooring uh
you know the employee and the
subcontractor
uh
what's your guys experience with that um
kind of set a baseline here between
three of us on
what what your guys's past and tells
what your experience is there and and
i'll share mine
okay um
i'll go ahead and start well you know
when when i started an industry i was uh
definitely under 10.99 um
i i didn't really
really know any different so so that was
where i started i did transition over to
uh w2 and play
at some point and you know they
they both have their place they both
have their benefit they both have their
drawbacks um
does it matter to me which one i'm
categorized
under now that i'm a little bit older it
does to some extent because you know my
my future is
my future feels to me better off uh
categorizing myself as an employee
versus the contractor because
items are taken care of for me and
there's a lot less work on the back end
for me to take care of on a personal
level um
with the government insurance and
retirement and all that so it just it
makes life a little bit easier um when
everything's kind of grouped together so
um preferably i would
say that i i like where i'm at as an
employee of our own business
at the moment yes
yeah we'll get into that a little bit
but i mean there's certainly other
options
uh if you are a sub and you own your own
business to be still an employee of that
business and that company
pay you as a employee so we can get into
some of that too
what about you daniel
you still came off as an employee didn't
you i know well
the wrong kind of employee the 1099
employee and
that's where this
i don't even think it's just the
flooring industry i think it's just
construction in general
tends to think that
that's okay and
and that's that's you know something
that people need to know that it's not
the right way to do things especially
when you are calling them an employee
and
they aren't
exactly working for themselves so i
started as um
what they would call a 1099 employee
right even though that's not really
a thing an employee's an employee
but for
for a few years i was on a 1099 and it
wasn't until
i went to go do my taxes and it's like
what i owe money like how is this even
possible like
and that's when
you kind of realize oh i've been paid
wrong this entire time and
what do you do from there
yeah a lot of guys have gotten stuck
from that deal and i think let's let's
take a minute to like clearly define the
difference because i think that's part
of it right i mean
daniel
and jose both of you guys sound like you
got started as 1099 thinking you were an
employee so to speak but
so
to define
the difference an employee
is paid a
in my there's my opinion and then
there's the legal uh version
uh you can pay an employee by the piece
as long as they make a certain dollar
figure and some of these things change
state by state some of the rules but in
general
uh they have to make a minimum they have
to make at least minimum wage even if
you're paying them by the peace if
you're going to
treat them as an employee now if you're
gonna do it that way you still need to
take out taxes
uh you know take care of their payroll
taxes take care of their income taxes
the whole works you still have to
encompass all that uh the most
traditional way and what in our opinion
is the best way to hire an employee is
hire them by the hour
uh pay their you know have them set up
they get work they have workman's comp
insurance under your company
uh they you know they are paid overtime
when they work over 40 hours and again
that's another thing that
changes state by state some of the
some states it's if you work over eight
hours in a day so it kind of depends
but the bottom line is
they're paid by the hour they have the
same benefits uh say vacation time uh
holiday pay those kinds of things that
maybe the office staff has
at our flooring company our hourly
installers have the same exact benefits
as our vice president
same health insurance provided by the
company same
same benefits with uh
vacation time and and holiday pay that
entire thing so that's my opinion
of what really having an hourly employee
is and then subcontractor is the 1099
guy that has to cover his own
insurance taxes those kinds of things
and i think where some people get caught
in this web is they're hired by the as
an hourly pay structure
but pay but
tax wise are treated as a 1099
uh
independent
contractor and so you you go working
for 15 bucks an hour
and at the end of the year you learn
that you owe
5 000 in taxes because the employer that
was
saying you were an employee and treating
you as an employee a lot of times which
is even worse meaning they
you got to be there at 7 00 a.m you
don't leave till 4 30 whatever those
time constraints are which
uh you know we get into compliance a lot
when you start talking about those
things because
you cannot have control over
that
subcontractor if you're paying them as a
1099 and you're not covering them
anywhere you're not taking care of their
unemployment insurance they're you're
not covering their employees
the employee stuff
then
um you know they're really not an
employee but at the end of the day
the pain that that causes to a lot of
installers who get started there
and they get behind on taxes and then
before you know it
taxes are a big item in their life a big
stress point so
that's that's kind of my uh
what's your guys's opinion is that
pretty accurate from uh yeah that's
that's pretty accurate and then you run
into the guys that
you know they don't know no better and
then once they
do find out that oh man i'm gonna oh
they just are like i'm just not even
gonna file
and they they try to go years and years
without doing it and then it's not until
some of these guys actually are like man
now i want to buy a house
but
because of the situation i put myself in
or the situation that
my employer has put me in by doing
things wrong
well i seem to remember us sitting on
the porch out in the country talking to
a certain installer that i won't name
but i mean those types of things was the
topic of conversation and everybody
sitting there it had something similar
that had happened you know they got
behind on taxes half the time they
didn't even know they owed taxes i know
people on this call
uh have been in the same position where
they got behind on taxes
and you know it was a
a major stressor in their life well i
did 100 you know and i did it to myself
um and i'll be transparent i'll be
honest
uh you know
first off i started out uh 1099 not
educated right like oh i'm making cash
i'm getting paid you know this is you
know under under the table type thing
he's just reporting it because he had to
show the money went somewhere
um and then once i found out about what
i had to owe
um
i was like
let me just kind of
dodge and duck as long as i can to try
to avoid it thinking it was going to go
away but no it didn't
um and it got to the point when i did
finally become a w-2 employee
um
i didn't want to raise any red flag so i
didn't even do my taxes when i was going
to receive a refund and all that did was
put me even more in the hole for
penalties and uh and interests uh and
you know and all that so it's there
there's there was a trickle effect
how did you deal with that i mean that
had to be major stress
you know um
when i i finally met my wife i
i had to make a decision right like if i
was gonna build a life and i was gonna
purchase a home and try to uh to raise a
family
um
i didn't want anything to be taken away
because it wasn't her fault and it
wouldn't be my kid's fault it was my
my
lack of knowledge that put me in that
situation my lack of uh
educating myself you know my pride right
not asking the right people the right
questions even though i kind of already
knew i should i just kind of avoided it
and
i called the irs
hey this is my name
i think i owe you some money okay you
are officially the first installer i've
ever met
i did as daniel dude
you know i just i didn't want it to come
back and bite me in the rear end
after i started doing things what i felt
was the right way you know and
i just didn't want to buy anybody else
either yeah no i mean kudos to you for
doing it i'm just saying that
it just keeps going generally and you're
you're talking the same you're telling
the same story that i've heard
for a long for
last several years that we've been
traveling
across the united states going to
different shows meeting with installers
all over the nation
it's a very similar problem
they didn't know any better they were
they the guidance they got was not good
they were young they got into flooring
they were getting you know 15 or 20 an
hour in cash it the money felt right uh
it felt good but at the end of the day
they didn't realize you know 20 of that
uh is going to uncle sam and they didn't
plan on it no but i really did not
just them knowing that that like
you know
there are options like the there's two
different ways of doing things now the
vast majority of flooring is
subcontracted and we i get that and and
go carrera supports that that's what it
was built for but we encourage
uh like
employment
in the true term of employee installer
to me
helps the industry to allow that that
individual to develop
now that that's not going to change the
industry i mean there's plenty of people
that believe that
you know employee installers are better
that that's a better path form
unfortunately you're never going to
squash or get rid of entrepreneurship
like we're entrepreneurs man i mean
you know i was a when i started i was
i started off as an hourly employee in
the flooring business um i made eight
bucks an hour to sweep floors and pick
up trash and
that kind of stuff
you know i stayed there for about four
years and even at the end of those four
years being mentored and and going
through uh being under some really good
installers after that four years uh that
company was getting ready to get bought
out so i went and started my own company
and i started subby
i i have seen every aspect of the
business
and i believe
that the decision between being a hourly
employee or a subcontractor
really boils down to your risk
appetite for risk and your ability to
execute on
uh
bookkeeping i mean it's pretty simple
stuff but it is important if you're
going to be a sub
uh you know we we grew our company very
quickly
and um
you know started to become a full
service flooring company a few years
later
because i paid myself as an employee i
paid myself 600 bucks a week as a sub
it didn't matter how much i made from
installing that went into the company i
took a 600 a week salary and i did that
for five years and that allowed the
company to grow and us to be able to put
back money and then start
full service supplying materials and
such
but
the that is not the path for everybody
and you just have to be honest with
yourself in my opinion
right like yeah some some people are
just better at being employees and
that's good that's fine we need the we
needed good quality employee installers
in this business as well
yeah
we definitely uh
definitely need to bring to the
forefront from the uh the implications
that someone could put themselves in to
help them decide what side of that line
they want to be on right um because it
can only
it can only help
uh
the construction industry and as a whole
not just flooring but everyone
um and
no we need to have an informed decision
like that at least give them the
information so if anybody's
watching this that you're you're a
flooring
subcontractor and you're behind on taxes
and you're like we feel your pain i
think that everybody's
sitting here has been in some version of
that at some point in our careers
the the the only way i think uh jose
brought up my
the this isn't tax advice but this is
just life advice go take care of it look
what jose did he went forward and said
hey i owe this money
i think i owe you this money anyway
i have no idea can you help me and you
know i attack the problem and go ahead
and
you know because it'll come back and and
bite you in the in the latter part of
your life when you want to buy a house
or a car or whatever
um
but back to the point you you guys have
hourly and subcontractors at your
company now correct correct
yeah we don't discriminate how do you
choose between that because i know that
over our uh business
life
there's probably eight or ten of our
subs that were hourly employees and we
actually helped them get into business
because we're not going to as we figure
we know what we've trained them to do is
an hourly and
i'm not going to stop them from chasing
their dream 100
i'm going to help them and i want to
continue to have them as a good resource
for installation for my company so
um how do you guys look at this how do
you determine
do you do you have a
determination on who should be a sub and
who should be an hourly or is it all
based on that guy
or girl
uh
historically like it's all based on the
person because we've had people as
employees that
have been like you know what this isn't
really for me i'm gonna start my own
thing and it's like
awesome if you need anything let us know
i mean um our ride on machines we've had
you know people use
if they don't have a tool here and
there's like here you go and it's like
you're not they're not even doing work
for us but we're still helping them out
because that's just
no one
ever really left on bad terms right and
it's like they always came to us like
hey this is what i'm thinking about it's
i'm not i can't keep you here man if
you're not happy you need to go do
something that's going to make you happy
and
um and then you know a few years later
we have them in here and doing a job
here and a job there and it just goes
like that but um right now what we do is
most of our stuff is in-house
and then
a lot of the residential were starting
to subcontract because
coming from a commercial background
we're just not as efficient
in that aspect
so if we can
offload that and that gives our guys
um room to focus on what they're good at
which is the commercial jobs yeah and
we're not we're not efficient it's not
because the lack of knowledge on our
part is because our
our focus has always been commercial and
that's what our our employees are
trained on was the commercial aspect so
every time we squeeze into some
residential here and there it is more of
a training process through the project
versus uh let's go get it done type of
process
well they run different there's no doubt
about it from a project management
standpoint the job's run different
uh let me ask you another question
what is the the biggest factor
uh that you see is why
somebody wants to be a subcontractor
versus be an employee
so what what what what's what's
motivating the guys you talked about
to to want to
leave a good company with
with the security of the hourly
installer
life what what what do you think
i think you like he said that's pretty
broad because we've had guys that
have left because they feel like they
just need to do things their way you
know exact words i need to do things my
way
okay have at it and
and then we have guys that
will see
a dollar figure and be like well if
you're making this much and i'm only
making this much that means that
i need to go do my own thing but those
are also the guys that once they start
doing their own thing it's like
one week they're
spending spending spending and then the
next you know
few weeks after that
it's
you know because the social media you
see everything it's posts about them
being broke and stuff so they they
really have no
[Music]
they don't have an idea of what it takes
and what it entails to
um gather the tools the insurance the
contacts and and try to
have everything you need at your
fingertips because it's
when you're out there and you buy it and
you've been in business for a little bit
and you've had some time to collect
everything to make the installs go
easier and you're an employee and you
have everything you need to do a job
from start to finish no matter what it
is it's a lot different than going out
on your own and all you have is knee
pads and a pouch it's totally different
you know no van no
so so some of the guys
so how do you stop so that's the key
right there in my opinion like if you
don't have the assets the tools the the
vehicle the the
the
let's call it just the starter kit to be
a sub i mean you got to have a vehicle
that's meant to do this you know a van
or an enclosed truck or something like
that you gotta have a work vehicle
and the proper tools to perform your
trade if you don't have the basics then
that should probably tell you to stay on
as an employee for a while and build
those
goals
build that stuff up buy your own tools
and buy your own thing and then you can
go
you know
out on your own later i think that one
of the
one of the things i've
um
recognized over the years is guys just
want to
um
like if they said we want to do it my i
want to do things my way from a
technical standpoint from a flooring
tech you know installation technique
standpoint that's not allowed like
you're still going to have to do it the
right way we're going to make sure
now if you're talking about
you don't want to get up at six and be
the office by seven and pick up your own
materials and then go to the job site
like more of our hourlies do
i get that like if you want to be your
own sub and
but there there really needs to be
almost this like starter kit the check
box do i have this do i have that do i
have this do i have that or prior to
going and being a subcontractor and if
you don't if you can't check all those
boxes you probably should stay as an
employee that's just
you know my two cents on it but
hey guys this is saying can you hear me
yeah what's up everybody hey how you
doing brother uh i'm doing good just
wanted to add to that topic you know um
so for me when i started yes i got the
van you know i got the tools the basic
tools to go ahead and start and as the
job requires additional stuff you know
you go ahead and invest whether you're
rented or you want to purchase it that's
kind of up to you
but what i also started doing because
when i realized look i'm not i don't i
don't want to grow my business while
doing the installation and i'm going to
find people to do the work and i have
people working for me i gave them like i
said look
i'm going to eat you guys like a
subcontractor
you are allowed to use my tools you are
allowed to take my vent until you guys
get up to a certain point you know and
that's what i started doing they drove
to my location to pick up my van and use
my tools and then they start you know
slowly building their own tools you know
with their pocket knives and
floor scrapers and stuff like that but
you know i still had the demo machine to
provide just to help them get going
because you know we're kind of helping
each other
so that was one way i guess you could
kind of start if you have
another business partner that could
provide you or support you with what you
don't have
yeah the only thing i see there uh
hussein and you can probably like
chime in here
is the liability of somebody
that's not an employee of your company
driving your vehicle
materials from one place to the other
and those types of deals can put you at
undue risk
so
you know having them as an employee
until they get there mitigate your risk
at least from a standpoint of personal
risk
because your insurance company would
want you to have them as an employee if
they're gonna be driving your vehicle so
that's just my two cents on that is if
you're gonna
you have to add them to your insurance
yes
yeah so
um
what what else do you see uh
daniel and jose on like
what are some of the
the biggest pros and cons um you know
everybody would say money for sub
because you can
make significant
money as a subcontractor but you got to
start checking off these boxes like
taxes insurance and things like that
that's a pro anacon i think because you
look at the money that you make but
not a lot of people talk about the
expenses that come with the amount of
money you're making either
and like you said you started you know
you were paying yourself a salary of
600. we started off paying
ourselves
half of what you were paying and this
this went on for a couple years and it's
like
was it hard absolutely and
would i do it again probably um but it's
it's a matter of
seeing that end goal and
actually knowing what you want it's uh
you
definitely spend a lot of
there's a lot of expenses that go into
running a business that a lot of people
don't see
and
that that's something that um a lot of
the organization organizations that are
out right now don't even talk about
which is
i understand why they don't but it's
frustrating that they don't because
they're you set someone up for failure
if you don't if you're not open and
honest about stuff like that and
expenses are
crazy
even
well that's why we're talking i mean
that's why we're having this
conversation is at the at the end of the
day here
there there's a ton of expenses if i
could give a sub any
guidance whatsoever is don't treat your
business because if you're a
subcontractor go open up
a llc or get a true business uh entity
consult again i want to make sure you
consult with an attorney and and an
accountant but this is my opinion
um open up an actual company structure
it's pretty cheap to open up a quick llc
and then pay yourself as an employee
put the money back
so that uh as you're paying yourself as
an employee you'll be taking out taxes
of what you pay every week and it helps
your dependency at the end of the year
or your your um
your com your commitment to the irs at
the end of the year if you're getting
money taken out weekly as an employee so
that's the first trip so you've been
paying your you every week you get paid
you're paying in to the irs until you're
and you're legal that way at the end of
the year if you didn't pay enough you'll
still owe but at least you've paid some
throughout the year
through your uh weekly payroll to
yourself so i would encourage every sub
to set themselves up as a company pay
yourself as an employee and don't treat
your company as a piggy bank it's not
just something that you made five
thousand dollars this week and you spend
five thousand dollars and that's that's
where that's where you get the guys and
i know we've you guys got a story about
facebook i'd like for you to kind of
chime in on but
that's where you get these stories of
guys being so far behind on their taxes
or they're broke all the time and it's
if you spend every dime you make and you
don't put that money to work for you
later and this is a bit of just business
and investment like
the the the
standard best practices i don't care
what industry you're in put 10 percent
back
for savings put 10 back
to to
for a rainy day and put 30 percent back
for taxes now if you can do that if you
do the math and that makes sense
okay
but those are just these baseline
figures that you should be figuring if
you think you're gonna make a thousand
dollars
in a week take a hundred put it aside
for your savings a hundred for a rainy
day right
300
for
um taxes and and and uh commitments for
there and then what do you have left
after you've taken 500 out
is a 500 so if that's still attractive
and you can make that work for you
by all means but
right too many times
the story like you guys uh were talking
about the other um in another
conversation we had is
i mean why don't you share that with us
i mean that's
the conversation going on on the west
michigan
page right
did you talk to him about it yes a
little bit ago yeah give him a little
bit of information on that sorry i'm
just he was gone when that was
conversation yeah no worries i mean just
kind of overview of yeah
on facebook
on facebook you know someone posts on
there that they're looking for someone
at a certain dollar amount
and then guys say that that they weren't
bashing but i mean i it's all
written right so maybe i read it wrong
but they're like
well i paid this much for i i won't pay
anyone less than this much or i start my
guys out at this much
and it's like
none of that matters if you're not
paying your guys correctly and they're
gonna end up having to pay their own
self-employment tax anyways
because if you think about it in the big
scheme of things they're complaining at
you know just throwing figures out there
if someone's paying someone 16 an hour
and you're like well i pay my guys 19 an
hour but you're paying them out of 10.99
so that's not a true 19 an hour because
if you
if you really break down how much an
employee costs at
i don't have the spreadsheet in front of
me but i'm i
i think the our cost
at uh 16 an hour somewhere around 22 an
hour is our
our all-in
yeah bear burden is somewhere average
around six bucks in an hour
yeah
so depending on retirement and
investment
yeah
yeah
and then yeah that's not even including
like
the the health care and all that yet so
it is it it starts getting up there
because you you don't think
you know you
a lot of these guys are going out there
and working and they're you know on a
1099 and they're not covered by comp so
if anything happens on the job site it's
like what happens then yeah you're not
protected cut your fingers off yeah
and you're not if if you're 1099
you don't and you don't have your own
insurance your own work comp insurance
um
yeah it's all that in my opinion i think
that's something that would be nice if
the industry would change not our
industry but the insurance industry i
think a 1099 guy
should have to have work com i mean me
that would take a lot of these
the guys that are playing as a company
uh almost you know they're not they
don't act like a company but they
install
and they're 10.99 it would it would take
those guys out of it and the only reason
i say this is for safety i mean
and at the end of the day
these are things guys don't think about
or things that
the installers aren't considering when
they're talking about going out on their
own um so i'm hoping that a discussion
an open discussion can kind of push the
you know how to at the end of the day
how are we going to move
forward progress
with
both employee installers and
subcontractors and i think it's just
really truly understanding the
difference between the two so you don't
get the wool pulled over your eyes when
you go talk to some retailer that's like
yeah man i'll you you can come work here
and i'll pay you 18 an hour and they're
like
and then at the end of the year it's
your story right
because that's the tax bill that's what
they kind of compare things to is you
can go work at mcdonald's and make that
amount of money but they're not taking
into
you know consideration that mcdonald's
is paying them out of w2
and then you get your whole benefits
package
and if you really just
just the simple stuff like paying
overtime
like on a 1099 these guys are working
straight time 100 of the time and
a lot of it is you know these guys that
are like i work 60 70 hours a week and
i'm doing fine well you're working 60 70
hours a week at you know 15 an hour
that's that's not fair for you guilty
well what you you brought up another
good point i mean what about
unemployment insurance so that you know
who's paying into unemployment for a
1099 nobody my dad was a painter uh
subcontractor as well i mean and he
never paid into unemployment insurance
ever and
at the end you know or
social security uh you know he needs
supplemented because he only has like
throughout his entire life he's only uh
he only contributed enough where he
makes three or four hundred bucks a
month
from social security because he was he
was an independent didn't pay himself as
an as a
as an employee so that you could start
paying into that right i've been
self-employed since i was 22 but i've
been paying into
my my unemployment my own unemployment
insurance my own um
you know um
social security all of that has been
paid since since i started the company
right and when you're an independent you
really don't think about
insurance because those plans aren't
necessarily
offered
you know if you're out on your own
unless you're doing like a traditional
or a roth ira and a lot of guys don't
even know what's out there for them to
contribute to
yeah and those are investments but just
regular insurance even i mean i'm
talking about pay
if you are just
taking in 1099 money and paying your
income taxes
but you're not paying into unemployment
right so you know a portion of every one
of our employees we have to match their
unemployment so that if they get laid
off or or you know whatever happens a
recession or whatever happens in the
world that if they're laid off there
they have you know the company has
money
in escrow with the state to pay
employees for the time that they're
unemployed right if they if they um
become unemployed those things don't
happen let alone social security i'm not
sure it'll be there by the time we all
get there or not but
you know my my dad never paid in and
that's why he has such a small amount
that comes into his
you know into him every year
so you know those are everything i think
like we need to think about as
installers when we're getting ready to
go
out on our own
i was lucky enough to have somebody tell
me just pay yourself as an employee
and you don't just you're not the bank
you don't get a thousand dollars from
your install that week and that's your
money you pay yourself in a
salary or a by the hour
whatever you make
goes into your company that's your
company's money and just you know i
think
having some of this knowledge that we've
been talking about on this call on this
conversation
can help a guy understand the real uh
commitment that it takes to do what
you guys have done what i've done is
literally
running your subcontract business like a
business
so
so
you know those are great points right
but if you started the business from
scratch and you know you you are paying
yourself
like i am not saying whatever you make
you spend but i kept most of the money
in the company if you can right if you
are the only person working
and you have to feed your family it's a
different story luckily my wife works
you know i can kind of take a lot more
risk and i don't have to take some
salary to myself but if you were to take
some salary to yourself you know you
gotta make sure that salary
is not going to bring your net income to
for your business to like negative right
you want to keep that
some income in there uh so that you
could basically what you're talking
about reinvest in the company
so
so throughout the years you know you
start building this i guess almost like
um
reserve
right now you you are able to
pay and you know pay your bills and pay
your guys it's going to take you to get
there a few years but once you get there
you have a much better cash flow that
you are able to wait for receiving your
payments your invoice but you're also
able to pay
i hope nobody goes out there and
whatever they get and they go spend
every week that's crazy
and then who's saying well i think a lot
of that happens
i know i know a lot of that happens and
i would also say that you do have to
start
when we talk when i'm talking about
paying yourself a salary
you you have to part of this is what are
your goals if you are just going to own
your job forever
make the salary big enough that i mean
like if you're just going to install
with your cousin as your helper and you
guys are going to run a really good
subcontract business but that's all you
ever wanted to be you never want to hire
more people you just want to have one
helper along with you the entire time i
would still say pay yourself a salary
whatever that dollar figure is
because
it just helps with you staying up on
your taxes and pay and unemployment
i mean for goodness sakes if the economy
took a downturn you're a sub and you've
been paying into unemployment for
forever you can be unemployed too so it
generates consistency too so if you like
uh i'll go back to the the loan type
deal you're going to go try to buy a
house or a car or something like that
you have consistency right because they
don't want to see one year you made you
know 50 grand the next year you made 80
grand and then the third year you made
30 grand they don't want to see that
they want to see some kind of
consistency they don't want to see
fluctuation in annual uh income either
and um and also to piggyback off what
hussein said he's right you
gotta keep money back into it when
when uh when we started it was dba and
we started as a dba and then uh
rolled into an llc and then classified
ourselves as employees right and that's
one thing people don't understand we've
said it a couple times that you pay
yourself as an employee
uh under llc
there are a lot more benefits to that
than you think there are dba man we put
ourselves in
not so good positions doing it that
route but yeah you're in a lot of you
put yourself in a lot of risk right in
the middle of a lot of risk
risk in the finances but once
once the llc was formed and we
restructured pretty much
the
the transition was a little hard at
first but the long-term benefits
outweigh the short-term uh discomfort of
not seeing
those dollars and cents right away um
like yeah i i would say that that
the um
you get
i mean again give with your accountants
but you have write-offs and things that
happen when you form a company and it
can help offset some of those costs like
your fuel costs and all these things
that are are business expenses now and
don't just come right out of your pocket
so i don't think that
hey if you if you know how to run a
company or you you've taken this
information and you're listening to it
you think i can do this i can be a sub i
can run then great just
i mean follow some of the you know
underlying
you know foundational principles we've
talked about but
if you're not
employee may be the best route for you
and that could be an employee with a
really good subcontractor i mean i know
a lot of guys that have 20 30 40 50
employees up even hundreds that are our
labor houses but they they pay their
guys as employees um and there are some
that do it wrong as well
but that's what this is for to try to
inform you to make sure you ask the
right questions from an employer if
you're a new installer you know say
you've been doing working for somebody
for
a a small subcontractor for eight years
and now you're going to
um
you know go out on your own
and and
be a sub as long as you understand the
parameters great on the other side of
that when you go if you wanted to go
work for somebody again don't get duped
into being paid like daniel was talking
as a 1099 guy and then tell you you're
an employee
you know
demand the right things if you're going
to be an employee i guess is what i'm
getting at there so right and there's
not
one isn't right and one isn't wrong
right because you can
pick and choose which one you want but
as an employer there is a right and
wrong way to pay an employee
you you yourself as the employer have to
actually figure out
all right i'm ready to go out on my own
but never be scared to ask people
questions because business is
it can it can get pretty confusing
there's a lot that goes into it so
definitely reach out to someone you
don't want to put yourself in the
position to where
now you want to buy a house and you
still can't even though
you're running your own thing
yeah don't get caught off guard 20 years
from now i mean we've talked about some
of the very f foundational pieces today
if you follow those you're going to be
in a heck of a lot better position than
you know i know some of us were
so
in closing here keep this thing right
close to 45 minutes every week we've
talked about the pros and cons
um
you know this this next week
you know we're going to be talking about
maybe you are a sub
image
what is the imager portraying you know
image isn't everything
but it's close
so how are you portraying yourself
that's on next week's episode of the
huddle um i want to
thank daniel and jose and
any um a couple other people that that
chimed in
and appreciate all the information and
good conversation guys you got anything
to say in closing here
no just i've i already said it don't
don't be scared to reach out to someone
that's already been through what you're
gonna go through because it's only gonna
help you out in the long run yeah
um and
i just wanna add like uh i'm a little
bit old school right and daniel brought
to the forefront a while ago for us that
there were organizations out there that
are geared around the installer and
helping educate and
people's
whether they believe it or not the
subcontractors were employed believe it
or not
everyone started somewhere and the the
majority of everyone who is in a
leadership role or position in the
flooring industry
a lot of them started where we did and
you know they they have a lot of
information that they're willing to
share it's not a secret it's not
anything they're trying to hide so try
to find an organization that fits uh
your model um do some research make some
phone calls um and
don't be shy man set pride aside
sometimes you know you're you got to put
put yourself in your family first and
there's something probably aside to ask
questions that you might be embarrassed
to ask or you might not even know you
have a question until somebody brings
something up
um
you know and
i think that uh
that is
the
maybe the best advice you can
have given is
ask questions we're going to be sharing
on this show
uh plenty of times different
organizations you can get in touch with
join this
join the the call we're we're on every
week on
every tuesday at 3 p.m central
and
send your questions in if you have any
questions we'll do our best to answer
them or we're going to have some really
great guests in the future that
that are going to be tied around uh you
know taxes and all this stuff we're
talking about but all this is built
around how to
build your career whether you're an
employee or a sub
and set yourself up for the best success
possible so with that i'm going to close
this call i want to thank the guys again
i really appreciate it and
i guess we'll see you guys next week
all right see ya