Ask a professional organizer who hires teams of Independent Contractors (ICs) to work with clients why they do it, and you are likely to hear any of these responses:
- I can earn more money this way than by only working solo.
- I can take on bigger jobs than any one organizer can handle.
- I enjoy the energy of working with a team.
- My clients need their jobs done fast, and teams can provide that.
- I’m experienced in marketing my business, while my team members aren’t. It works out better for all of us when I find big jobs for my team members.
Working with teams is not for everyone, but if you’re interested in exploring how you can use team organizing to build your business, there are many good reasons to do so.
Employees vs. Contractors
Before you agree to take on a job and assemble a team, there are some important steps you’ll want to take to protect your business and your team members. The first is to decide whether your team members will be employees or independent contractors.
In the United States there are very clear regulations that govern whether someone must be treated as an employee. If you do have employees, you will be responsible for withholding income and other taxes, paying a part of their Social Security taxes, and observing a variety of laws regarding workplace safety and fairness. You can learn more about hiring employees from the U.S. Department of Labor. Be sure to research your state’s regulations.
Many organizers who use teams prefer to work with independent contractors, that is, organizers who have their own businesses but agree to serve your clients as part of your business. There are some very specific rules that you as a business owner must follow to avoid accidentally turning your independent contractor into an employee, which would make you liable for a hefty tax bill, among other obligations. You can learn more about the differences between employees and contractors from the IRS website.
The Independent Contractor Agreement
To make sure that you and your contractors share the same expectations about your relationship, you must start with a good written agreement. Your agreement will need to clearly spell out:
- expectations about ethical behavior, for example, confidentiality
- your agreement regarding solicitation
- handling client payments
- handling mileage and travel expenses
- how and when you will pay your independent contractor
- what steps the independent contractor is required to take to maintain their contractor status and avoid appearing to be an employee
If you’d rather not start from scratch to write your own independent contractor agreement, Metropolitan Organizing sells a package of resources for team organizing called Team Management Essentials. The package contains over 20 pages of resources, including a template for your independent contractor agreement.
Communicating with Clients
When your business is just you, client communication is pretty simple. You will probably have one rate and one way of working. Once you introduce team members, you’ll want to take steps to keep that original simplicity.
Don’t complicate your client relationships with a lot of detailed explanations about your exact legal relationships with your team members. They probably don’t care, and you don’t want to risk creating unnecessary confusion.
First, make sure the client knows that there will be multiple organizers on-site and get their approval. Help them understand that you use teams to make the work go faster and keep their costs down.
Do identify who is the lead organizer and who are the team members. Let the client know to whom they should address questions or concerns.
Make sure that your pricing is clear. Specify how many lead organizers (typically there will be just one) and how many team members will be on the job. If you charge a per-hour fee, spell out how much the fee is for the number of organizers. My personal preference is to quote a fee for the entire team. For example, I would quote a price for “one team lead and two assisting organizers” rather than a price for “lead by the hour” and “assisting organizer by the hour.” Don’t make your client do the math.
Tips For Creating a Consistent Client Experience
When providing teams to your client you’ll want to ensure that your business’s brand is being presented consistently. Here are a few tips to make sure that the client has a seamless experience with your teams.
Decide to whom the client should direct questions, and then communicate that to your team members and to the client. If you are the lead organizer on a big moving job, for example, you may not want the client asking one of your independent contractors questions about how long the whole job will take; that is something for you, the lead organizer, to address.
While you cannot legally provide a uniform to an independent contractor, you can require that they not wear clothing branded with their own business name or logo, for example. While most contractors will understand this without being told, it’s good to make it explicit.
You can prescribe exactly how an employee performs their job, but you cannot prescribe how a contractor works. How can you help to ensure that contractors provide a service that is not unlike what you and your employees would provide?
Giving free training to someone is one of the flags indicating that person is an employee, so you will want to avoid that, but you can still communicate your preferred way of doing things to your contractors.
For example, you might offer a paid training in your method and suggest (not require) that your contractors take this training at their own expense. Just be sure to make clear in writing that you are not prescribing how your contractors work.
Your Business Revenue
One of the best reasons to use teams is that your business can earn more revenue than is possible when you alone are working with clients. Assuming that you are working as the team lead, you will be earning your regular revenue plus a percentage of whatever the client is paying for the assisting organizers, too.
Every business has its own way of arranging payment, but one common division is to pay independent contractors a percentage. If the IC is well established and has years of experience, you might decide to pay her 40 percent of what the client pays while the business keeps the remaining 60 percent.
For example, if the client pays $100 per hour for the independent contractor’s work, you will pay the independent contractor $40 and your business will keep $60.
If at first this seems like an unfair split, consider that you are responsible for gaining the client in the first place (not a small job!), doing the legwork to make sure that everyone knows when and where the job is, paying your bookkeeper and all your support staff, and sometimes paying your contractor even if the client fails to pay you. All that adds up to a lot of time, resources, and risk, so don’t short-change your business by keeping too little of the revenue from a team job.
If using teams to build your business sounds like a strategy that is right for you, I encourage you to do it. Clients love how fast the job can go, and you’ll love how fast your business can grow!
To help you build great teams, I offer Team Management Essentials, a package of resources including checklists and templates you’ll need. And if you’d like some one-on-one coaching to help you on your way, that’s available, too!