Should I be getting a 1099 or a w2 at my salon?
Jan 02, 2023The amount of employee misclassification in the salon industry is wild.
But, the refusal to accept responsibility for doing it literally boggles my mind. There are so many people who don't understand (or knowingly) misclassify employees and when their methods are questioned they lash out, and go into a reactive state and say things like
"not all salon owners are bad" (no one EVER said that) "You don't know how hard it is" (this is bare minimum ground floor knowledge that any responsible salon owner should have) "employees these days are so entitled, if they don't like it they should leave or open their own salon" (they do).
Stylists and other beauty professionals are starting to take up more space and shedding light on illegal business practice
I don't have a tolerance for it, because if you own a salon knowing how to classify your employees should be a priority. It's something any decent CPA will be able to help you with, and it's also something that spending a few minutes on google should help you have a basic understanding of.
If you are wondering anything along the lines of the following:
"The Salon I work at is giving me a 1099, but I think I'm actually a w2 employee"
"How do I know if I should be classified as a 1099 or a w2?"
"Do the salon I work at have the right to take the cost or color or supplies out of my pay / deduct supplies from my pay?"
"How do I find out if I'm being misclassified as a 1099 by my salon?"
Here are some quick and simple FACTS and also some links to great resources to help you navigate how to handle a salon that is misclassifying you - or what you need to know as a commission or booth rental salon suite owner to avoid being fined by the IRS or department of labor for misclassifying employees. Also know that if you are doing this, and reported for it, there is a high liklihood that you will owe back pay/damanges to misclassified employees.
Why can't commission salon owners charge w2 employees for their product? The very short of it is this-
If you're a w2 employee you can't deduct what you spend on supplies on your taxes. So everything from color to hairspray is legally supposed to be paid for by your employer. IF YOU CAN'T WRITE IF OFF you shouldn't have to pay for it. It's ctually pretty simple.
If you're getting a1099 the salon isn't your boss, and they cannot congtrol certain aspects of how to do your job. They can't tell you what to wear, when to show up and work, what products to use or basically anything about how to do your job. So, if you ARE being controlled in any of those areas you are a w2 employee and they have misclassified you.
If you're a w2 employee and being told you have to pay for your own supplies, it's also likely that you're being misclassified (or that the salon owner either doesn't know the law or is ignoring it.)
Always save every reciept for every penny you spend on your business/work related expenses. If you think you're being misclassified speak to a CPA and also check the resources below.
If you try to speak to your salon owner and they won't listen to you, you can also direct them to these resources and if you are owed money due to being misclassfied you can reach out to the department of labor, or an attorney for next steps.
Myths About Misclassification - Department of Labor
IRS.gov - Independent Contractor or Employee?
Wage Deductions - Salon Owners Charging Employees For Product (This Ugly Beauty Business)
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