How to Hire Employees: Employee or Independent Contractor

If you work by yourself, there is a limit to how many clients you can serve. I started my cleaning business with myself as the sole cleaner and while I wanted to do more and make more money, I realized I needed help.

Not only are my hours spent cleaning, I also spent time advertising my services, buying supplies, and managing records. If you find yourself at this point, you may want to start thinking about hiring help. But first, if you want to know how to hire employees, you need to determined whether to get a regular employee or independent contractor.

Choose between regular employee or independent contractor

There are a few important things you want to consider if you are going to expand and hire employees. Do you want to hire them as regular employees or independent contractors? Regular employees will require worker’s compensation, withholding taxes, and a payroll system. On the other hand, hiring independent contractors does pose its own challenges. For example, they will need to provide their own tools and not be beholden to set hours or schedule. Contract labor will carry their own insurance and business license.

My personal take

Personally, I would hire contract labor for one-off cleaning services that I will need help with. For example, signing up a client that has a big home will require extra hands. If you are unable to find contract labor at such a short notice, you can also hire family or relatives and pay them via contract labor. However, if I have clients who need my services on specific days of the week, then I would hire employees and pay all the necessary taxes. I also recommend hiring employees if you prefer to have more control.

Do the right documentation

When hiring contract labor, make sure you have all the agreement and documents in place. You must also report the amount you paid contract labor each year on a Form 1099-MISC, but you do not have to withhold taxes.  Otherwise, if for some reason the IRS determines that your contract labor was actually an employee, you could be held liable for back withholding taxes and potentially penalties.

One specific document you may want to review is IRS Form SS-8 (Determination of Worker Status for Purposes of Federal Taxes and Income Tax Withholding) which provides information on the criteria used by the IRS to determine work status. It is available on

Ramp up slowly

When hiring employees, one tip is to start out on a part-time arrangement. He or she can then slowly take your place on certain days of the week. This will free up your time for admin and other work such as looking for new clients. Therefore, I recommend a slow ramping up on hiring. If you quickly book lots of clients and suddenly your employee quits, you will struggle finding an immediate replacement or lose credibility by cancelling on clients.

After some time, you can have your employees do all of the cleaning. You can then focus on running the business, such as keeping records, employee scheduling, and advertising. Having staff means needing to manage admin tasks such as insurance, taxes, and background checks. Once you know the kind of staff you want, whether employees or independent contracts, and the implications of each, then it is time to start advertising your job openings.

Do you have any other advice on how to hire employees?  Chime in below!

About Cathy Sanders

Cleaning Business Now is my life, my passion, and where my heart is. Help me help others start, run, and grow their profitable cleaning/janitorial businesses!
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