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Converting 1099 to W2 Employee
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Converting 1099 to W2 Employee
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Our company employs physicians no longer wants to employ 1099 contractors so we are converting them all to W2 employees effective 1/1/2011. Our Regional Manager is having the conversation with everyon
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Converting 1099 to W2 Employee
posted at 10/29/2010 6:26 AM EDT
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Posts: 16
First: 12/17/2008 Last: 10/29/2010 |
Our company employs physicians no longer wants to employ 1099 contractors so we are converting them all to W2 employees effective 1/1/2011. Our Regional Manager is having the conversation with everyone today and I need to put together in writing a communication letter describing the changes and what's going to happen. Does anyone have any suggestions or sample letters that I could use to get a start on this. I have no idea where to start. Thanks! |
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Converting 1099 to W2 Employee
posted at 10/29/2010 9:56 AM EDT
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
I would expect to get asked questions on WHY this change was made and what is the difference -- and even possibly some of them asking if they should have been employees all along. Which could lead to a prior wage claim (mostly for tax issues) if the difference is not more than "it's just what we decided to do". They probably will be happy about their portion of FICA being lowered, but if the employer is going to lower pay to compensate for that, it might not be that big of a positive.
Beyond that, I would explain the tax withholding obligations and what taxes the employer pays outside of FICA...that is unemployment, possibly state disability and then any other employer-provided benefits. Either those that are fully paid for by the employer or those that are cost-shared. Will you have an employee handbook? What new rules will be in place? Will how often they get paid change? |
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Converting 1099 to W2 Employee
posted at 10/30/2010 5:01 AM EDT
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Posts: 1103
First: 3/16/2007 Last: 8/19/2011 |
I would add that you are actually hiring these individuals and they are fully subject to your rules and policies. Having dealt with Physician hiring extensively in the past expect significant objection, requests (legitimate) for contracts, etc.
You don't mention anything regarding credentialing, etc so please ensure that this is also being accomplished. |
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