In the world of independent contractors (ICs), being “unsure” is never an option. With enhanced scrutiny from the IRS on companies who hire ICs regularly, it’s critical that Yoh’s client, a mass media and entertainment company, knows everything possible about its ICs at all times. Who’s coming, who’s going, how long they’ve been there, what their project entails, when it’s finished, if it can be extended, what their favorite color is…OK maybe not that last one, but there’s a lot of info that’s needed to assure full regulatory compliance.
Originally responsible for only vetting independent contractors to assess whether they qualify as an IC, Yoh showed its chops and grew its role with the client to fully manage ICs from top to bottom. After a four month implementation, Yoh worked with hiring managers to assist with the collection and organization of data, centralized all IC contracts, and installed new auditing procedures and VMS technology.
Since Yoh took over, all independent contractors are fully managed through the VMS system, providing full visibility into IC status, spending, deadlines and more. Procurement can now easily find, track and budget all of their ICs instantly and from anywhere.
$134.7 billion industry
5.2 percent estimated revenue growth for 2017
1,715 TV U.S. television series
5,083 television production businesses
65,156 television production employees
From hour-long epic dramas that have us talking about them throughout the offseason, to reality shows that set Twitter abuzz for hours each week, TV is having quite the moment.
In order to produce this amount of amazing TV every year, there are hundreds, and sometimes thousands of others working on the other side to direct, edit, produce, mix, conduct, market and disseminate episode after episode.
So why are these people so integral to making the shows we binge so good? For Yoh’s client, a mass media and entertainment company, many of them are independent contractors (ICs), experts in their field who come in to work on a project, do what they’re asked, and move on. But, there are always risks that come along with ICs. The IRS has strict compliance guidelines about who qualifies as an IC
and how long they can work for an organization before they’re qualified as an employee. Misclassify an individual and harsh penalties potentially await.
So how do you make sure the IC you’re hiring is fully compliant with the law? And how do you do that while also managing, paying, off-boarding and monitoring the entirety of your existing IC workforce to ensure compliance, visibility and on-time payment? You call us.
Vet it and Forget it
As part of the initial phase of the process, Yoh was tasked with evaluating any given project to determine if it qualifies, according to federal IRS guidelines, as a project for an IC. Yoh would evaluate the individual being hired to ensure they qualify solely as an IC, not a full-time employee, part-time
employee or otherwise. To do this, Yoh provided each potential contractor with a 10-minute questionnaire designed to mimic the questions an IRS agent would ask and make a determination of whether or not the IC meets IRS guidelines. Yoh determined the details of each project and in return provided recommendations to ensure that both the project and candidate were strictly ICs and a perfect fit.
Hiring managers no longer had to worry about whether the individuals they were placing met the IC threshold; Yoh took care of that. But still, there was something missing.
All in the Family
After seeing the level of IC compliance knowledge Yoh has, the client realized it wasn’t using Yoh to its full capacity. Despite Yoh reviewing projects and hires ahead of time, rarely did company leaders have insight into how long contractors were working on a project, what their status was, how they were being paid, or what the overall spend was.
But in a fully implemented Yoh IC system, those questions virtually disappear. Once the IC has been vetted and both the contractor and the client agree on project specifics, Yoh takes over. Our
experts draft the contract, including what our experts call the “Statement of Work.” This details the project duty, the project expectation, the timeframe, the agreed-upon payment terms, the list of projects and more. The contract is then sent to the IC for final review, sign off, implementation into the
VMS system and, eventually, execution.
Throughout this process, Yoh assists the client with the collection of current IC data, the organization of existing data, and the verification of legacy projects to provide top-to-bottom visibility into the company’s IC workforce. With that knowledge, Yoh provides consistent auditing from our shared service organization, which supplies additional checks and balances for the company’s IC program.
Yoh manages any screenings or background checks that may be required. They provide the contractor access to tools and systems, and trains ICs on how to use the VMS with multiple webinars. Finally, Yoh manages the invoicing, payment, and secure off-boarding of contractors once a
project is complete.
Over the course of the four-month implementation, Yoh’s small team of experts together vetted more than 250 ICs, introduced them to the VMS system and built an IC management system from the ground up. Before Yoh came aboard, the company had no independent contractor process, no compliance auditing, no centralization of contracts, no database and no visibility. Often, leaders didn’t
know ICs were on a project until they received payment for their work.
Now, vetting upwards of 450 ICs per year, the client can find and track the status of an independent contractor at a moment’s notice through the Yoh-implemented VMS. The client saves money not only by having a database to reference when budgeting projects, but also saves potential fines and penalties from the IRS by avoiding compliance issues. We showed the media company how an IC system really works so they can put on the shows we all love. Think you could use some IC expertise? Let us show you.
I recently had a conversation with one of the heads of talent acquisition about the proliferation of social media into our daily lives. From the...Read More
Boomerang employees is the latest staffing and recruiting trend that is stirring ample attention. As prior employees are re-hired into the...Read More