Get Your Personalized Quote Now


W2 Employees vs. 1099 Contractors – how to effectively balance your RISK

April 30, 2014  |  Leave a comment

My daughter and I found ourselves 100 feet off the ground, only a few ropes keeping us from disaster. Each step forward strengthened our faith in our safety equipment, and the assurance of the guides reminded us that thousands of people have traversed without incident. Trusting our equipment and team leaders, we not only overcame our fears, but were rewarded with an amazing lifelong memory.

Why would anyone would tackle a high ropes course without a safety harness? There are too many variables that can turn a thrilling experience into a tragedy.

Balancing Risk Protection and Costs – Independent Contractors vs. W2 Employees

Over the last 20 years Fusion has provided 1099 Contractors to execute our clients’ events; however, the increasing industry-wide risk of co-employment, stress, hours and costs required to fight unemployment claims were placing our agency partners and clients in an unnecessary position of risk.

After seeking wise counsel, this year we made a strategic and industry leading decision to provide W2 Employees for our clients’ programs. According to Employment Law specialist, Mr. John Sparks, Partner at Austin & Sparks, “The IRS Code provides a safe harbor to employers who misclassify their employees as ‘independent contractors’. However, should the employer fail to prove it acted in good faith, the safe harbor provision offers no protection.” See In re: Arndt, 201 B.R. 853 (USDC M.D. Fla. 1996).

President of the US Staffing Association, member of the White House Business Forum, and Staffing One, Inc., President, Crystal Blackwell, recently shared, “Many firms placing 1099 IC’s are being hit with some hefty fines for misclassification, and the DOL is now going back to their clients and may hit them with charges as well.”

Today, you’re taking very risky steps if you’re placing 1099 Independent Contractors in the field to staff your promotional events. We can help. It’s NOT worth the risk. Trust in an Event Staffing partner who will manage your risk in presenting W2 Employees for your experiential programs. Fusion will serve as your “safety harness” to protect you and your agency.

Leave a Reply

Your email address will not be published.