View Full Version : Piecework or Private Contractor?

03-18-2006, 05:14 PM
Does anyone have any experience with using non-employee labor?

I have a project already in motion. The Printing and the Distribution are both easily handled. But I’ve reached my max in the Assembly stage.

I need workers to assemble packages of materials (similar to “stuffing envelopes”) and can’t locate the answers to some potentially serious questions.

If I pay a certain amount per piece, how do I handle this for tax purposes? Would this be the same as a regular 1099 free agent contractor? I get two different answers from the IRS, and would love to hear from someone who’s actually done this.

Is this even the best way to go? Maybe I should pay a “stuffing” service, and not even worry about the taxes, even though it might cost more money.

Opinions, anyone?

03-18-2006, 05:24 PM
I guess one question is whether it is tenable to outsource this to another country. The reason I ask this is that the only jobs we have ever outsourced were done via the internet: rentacoder and similar portals. The winning 'bidder' was overseas. We simply paid them via PayPal and that was that.

As your task is physical this may not apply, but the principle may. Perhaps there are portals through which you can assign this sort of work and simply make a payment remotely. It's one idea anyway.

If not, I'd go for the "stuffing service" just to avoid the hassle (perhaps I'm lazy).

12-15-2018, 01:11 PM
Piece work should be a "win-win" situation for the employer as well as the employee.

Piece work gives the employee opportunity to take ownership of his/her abilities, and make more $ as opposed to an hourly rate. The employer knows exactly what it's respective costs are.

Piece work has typically promoted efficiency as well as quality, as the employee is held accountable for a properly completed task as a condition of the piece rate pay.

I will say however, that with our own operations piece rate vs. hourly rate has had absolutely no effect on quality. As a matter of fact, hourly, (milker-types), have been the typical poor quality producers.

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Ryan Reynold
01-04-2019, 04:56 AM
Piecework and the Minimum Wage. ... Note that only employees are protected by minimum wage laws, not independent contractors, and per-piece pay structures are often used as pay rates for freelancers or independent contractors.