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PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4033
Experience:  35 years tax experience, including four years at a Big 4 firm.
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I own 4 fantastic sams ,,32 employees...min wage of 15/hour

Customer Question

I own 4 fantastic sams ,,32 employees...min wage of 15/hour worries me to the point of employees make between 10 to 25 per hour and the min wage of 15/hour would cost me 150k/yr extra which is exactly my income! I have been thinking of 1099? thinking of adding tips to wages? thinking of telling them to clock out when no client? and all these seem to be illegal?right? do you have any ideas as to what I can do legally? and survive?
JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: no
Submitted: 1 month ago.
Category: Tax
Expert:  PDtax replied 1 month ago.

Hi from just answer. I'mCustomer I'll assist.

Customer: replied 1 month ago.
Customer: replied 1 month ago.
please tell me what you are proposing
Expert:  PDtax replied 1 month ago.

Service businesses like yours will have issues with labor increases. It's not insurmountable, but some effort will be required to run things more efficiently.

Scheduling, staffing levels, reviewing the productivity of employees, all could be areas to focus on. Paying haircutters hourly when they have no appointments is wrong. Scheduling patrons for pool assignments instead of just for one stylist is another.

For example, stylists that make $25 per hour should earn you $50. A check of each person's productivity will identify the profitable employees and service mixes.

I would also look at staffing levels, since eight stylists in a store seems like a lot for what is likely 77 hours open a week (10 am to 9 pm). If all are full time, that implies for stylists on duty all the time. Salons I work with do well with three. You might have two extra stylists in each store.

Raises in the minimum wage will only impact those who do not yet earn $15 per hour. But, I suspect that increases in the minimum will cause employers like you to cut the number of employees.

It does mean that you should look at productivity and profitability by employee.

Thanks for asking at just answer. Positive feedback is appreciated. I'mCustomer

Expert:  PDtax replied 1 month ago.

PD tax here, just following up on my holiday response.

Please advise if you need anything more, or rate my assistance if this met your needs.

Customer: replied 1 month ago.
hi,, what most people do not know about fantastic Sams is that first off all scheduling is very difficult because we have $200
day and the next day we can do $ how staff like this? number two is that only 10% of employees can be paid 15/hr
because they do 3x15=45/hr in production...80% of fantastic Sams employees get paid min. wage and if they were any better
they would steal the client info and open their own station....the only way to survive in the future I am thinking is to have them clock in and out for service only and when they have no clients, they be off the clock and can leave the premises but they would risk their position when it is their turn...I am trying to make this as legal as possible , otherwise, I have no solutions really ??ty ...robert mavaddat(###) ###-####
Expert:  PDtax replied 1 month ago.

Offer posted to consult.

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