However, I have to warn you that you are probably violating tax and employment law by treating these people as 1099 contractors rather than W2 employees. By doing so, you are exposing yourself to sizable penalties from both the IRS and your state tax and employment jurisdictions (the latter for unemployment compensation taxes, among other things). The IRS has a series of 20 questions that it asks to determine if people are legitimately independent contractors, whose compensation is reported on Form 1099 with no withholdings, or employees, whose compensation is reported on Form W2 with withholdings for personal income tax, Social Security, Medicare, and unemployment. If you are found to have treated people improperly as 1099 contractors, you can be liable for the full withholdings (both your and their share), with penalties and interest. I appreciate the paperwork hassle, but "it is easier for me" is not a valid excuse for the IRS, and the penalties can be hefty.
You can see the list of 20 questions at http://www.chancellor.com/compliance/20q.html. You can get an official IRS determination by filling out the form at http://www.irs.gov/pub/irs-pdf/fss8.pdf
Sorry about the slow response; there were some internal problems that prevented me from posting a response before now.
Does .25 for the quarter hour work for you, to get back to the original question you asked?
It's certainly an unusual business setup that you have. The fact that your helpers are setting their own hours would be a factor in favor of 1099. There are other factors, though, that would tend to point toward W2--they're working at your site, under your direction (& training?), paid by the hour, for an indefinite length of time, probably not doing similar work for someone else. The biggest disadvantage of that is, of course, that you would have to pay Social Security, Medicare, and unemployment taxes on their wages. More information directly from the IRS is available by getting Publication 15-A at http://www.irs.gov/pub/irs-pdf/p15a.pdf. There's a whole section in the publication on "Employee or Independent Contractor?"
Sorry to be opening up a can of worms for you! But the penalties for getting caught later can be really painful.
VITA tax preparer; investor
Developer of accounting software, tax preparer in IRS VITA program; 20 years of investing experience