Every business owner, particularly, the owner of a very small business understands that the success of the business can be hindered by the lack of meaningful effort from even one employee.   Unlike very large businesses where no one employee can have a dramatic affect on the course or outcome of the business in a small business each employee is a crucial part of the business operation and, ultimately, its success.

For a small business owner it can be devastating if an employee does the minimum necessary to fulfill the job duties but brings nothing extra to the tasks at hand.   Let me give you a simple but demonstrative example that may illustrate my point.   Thinking it is not necessary to micromanage your employee, you casually ask him to load some items on the back of a truck for delivery and that employee loads those items so haphazardly that they are bound to fall off the truck and a second employee who you ask to drive the truck never gives a second thought about the load and drives off only to have the items fall off the truck and become damaged.   Technically, each of these employees did the job that was asked of them but clearly did not bring any care, attention to details or common sense to the task resulting in hardship to the business.

This kind of half hearted effort happens every day and can undermine a business to the point that despite the best efforts of the owner and other employees who care about doing a complete and thoughtful job the business is driven into the ground.   It seems to me that when a small business hires an employee it should be understood and expected that the employee is to not just do the tasks assigned at the most rudimentary and basic level but should elevate their efforts by bringing their intuition, common sense, and desire to do a good job to the tasks.   Just as in my example, the first employee should have loaded the items on the truck using common sense, with an attention to detail and with a desire to do the job right.  The second employee should have cared enough to check the load before he drove off.   Doing a job with a high level of skill and care instead of just giving a half hearted effort can make all the difference in the success or failure of any business.

Some people may say that it is the owner who needs to take care of his business and that the employees are there solely to do a job and nothing more.   As far as I am concerned, any employee who does not care or understand that their job is part of the “big picture” is not providing a service any more valuable than a piece of equipment such as a copier or fax machine that performs a needed function but brings no thought or concern to the task.   A valuable employee knows not only his job but how his job fits into the overall operation of the business and what role his work will play in the success of that business.   On the other hand, an employee that offers only a half hearted performance does a disservice to his employer and is a detriment to the success of the business.

Any employee who gives the bare minimum effort needed to just get by is really giving no meaningful or worthwhile effort at all.

On Monday, Joe questions those that are quick to cry racism in “Not Everyone Is A Racist”.



In any endeavor, there is always a core group of people that you come to rely on to get things done and who seem to make a difference.

At one time, USFSB had a large number of employees and, yet, we were not getting much more work done then we are now with fewer employees.   USFSB was overloaded with employees and there was a significant amount of wasted time and duplication of effort.  We realized that we could and should pare down our work force to make USFSB more efficient and cost effective.

The reduction in our work force was accomplished in many different ways.  In some cases, it was purely a matter of not needing or wanting what the employee had to offer.  The best example of this was when we let our marketing person go and his design assistant became an independent contractor.  In other cases, it was a product of the new custom computer system being much more efficient which allowed USFSB to be able to do the same work with less people.  In some cases, employees resigned for one reason or another or were let go for cause.  Of course, we also had to make some decisions based on the changing economy and the reality that we needed to streamline our work force to be more cost conscious.

In each case, Annemarie and I would weigh the relative strengths and weaknesses of each employee when deciding who should stay and who we should let go.   This is not an easy task and in some ways it becomes a very subjective process.   In many cases, we enjoyed working with each of our employees and valued the contribution they made to USFSB.  However, difficult choices had to be made and we tried to make those choices in a fair and thoughtful manner with the best interests of USFSB’s future in mind.

USFSB now has the ability to do everything that needs to get done with the help of a core group of employees that have survived that process.  We are happy with the choices we made and believe that in each case we kept the right person for the job.  Just as important, we believe that our employees are happy to be here and share our desire to get things done and make a difference.

On Wednesday, Annemarie notes the value of teamwork in the office and at home in “Teamwork”.   



I have always believed in the proposition that you should treat people as you would want them to treat you.   I try to live up to that belief in both my personal and business life.

In my personal life this will manifest itself in many ways.  I will give my friends the benefit of the doubt and will take the position that they deserve my loyalty unless and until they show me otherwise.  I also will not judge my friends based on what other people say about them.  I will try to base my opinion about my friends on how they have treated me and not on how they may have behaved with others.  There are always two sides to every story and I don’t want to condemn someone, particularly, a friend after only hearing one side of that story.

In business, I try to adopt the same principles; however, I have found that the dynamics of the workplace make this more difficult.  As I have mentioned, when I first came to USFSB I did not have a lot of experience with managing and supervising a group of employees.   There was a significant amount of bickering and jockeying for position that may be considered standard office politics but which was totally foreign and, somewhat, disturbing to me.  This was compounded by the fact that as the employer you can be cordial to your employees but you, also, need to be a little distant and detached from them and the office politics so that you do not appear to be taking sides.  You need to be above the fray.

Even though, by and large, I was not friends with my employees, I still tried to treat them as I would have wanted to be treated by my employer.  The biggest disappointment, for me, in running a business and interacting with my employees was the fact that I was often wrong in my belief that my good deeds would be rewarded.   I believed if I treated my employees fairly, gave them financial rewards, and helped them as much as possible that I would, in turn, be rewarded with their loyalty, extra effort, and genuine concern for the success of the business.   I have found over the years that this is not always the case.       

On more than one occasion, when an employee has resigned, they seem to totally disregard all of the good things that had been done for them.  Even when they give reasonable notice, which is not always the case, they call in sick with impunity, they don’t follow through with promised training, they leave their unfinished work in disarray, and they generally act as if you do not deserve any loyalty.   When this happens, Annemarie and I can only shake our heads and say to ourselves will we ever learn?   On these occasions, I am reminded of the fact that, at least, in the workplace sometimes it seems that no good deed goes unpunished.

On Wednesday, Joe makes an observation about the breakdown of respect for authority in our society in “Respect Is Hard To Come By These Days”.


This is the second part of a two-part series.  Read When Is An Employee Not An An Employee? Part 1 here.


Generally, the following are characteristics of an employee rather then an Independent Contractor:

  • The worker is required to comply with instructions about when, where, and how the work is done.
  • The worker is provided training by the employer.
  • The success or continuation of the business significantly depends on the work being performed by the worker.
  • The employer hires, supervises or pays the assistants to the worker.
  • The worker has a permanent or indefinite work relationship with the employer.
  • The employer sets the worker’s hours.
  • The worker is paid by the hour, day or week rather than by the job.
  • The worker’s business and travel expenses are reimbursed by the employer.
  • The worker performs the work only for the one employer and not to the general public.
  • The worker does not supply any required materials.
  • The worker does not have an investment in the tools or facilities used to perform the work.
  • The worker cannot generate a profit or loss from the work being provided.
  • The worker can terminate the relationship with the employer at any time even if the work is not completed.   
  • The worker is required to perform all of the work on the employer’s premises.

The above are simply guidelines to help you make the determination of when a worker is an employee; however, even if some of these characteristics exist, the worker may still be classified as an Independent Contractor.   In many cases, it will be the degree to which these characteristics exist that will be the deciding factors.    Each situation must be judged on its own unique circumstances.

If you would like more information, you should consult with an accountant or tax attorney; or, check the relevant IRS publications.



The title may lead you to think I am simply giving you a riddle to solve; however, finding the answer to this question is no game.    Whether or not someone who provides services to your business is an employee or an Independent Contractor can have a significant impact on you and your business.

Generally, an employer must withhold taxes, withhold and pay social security and Medicare taxes, and pay unemployment taxes on wages paid to an employee.   The employee must receive a W-2 tax form by the end of January showing the total wages and the withholdings for the prior year.  An employer is also usually required to provide Workers’ Compensation and Disability Insurance coverage to employees.

None of the above obligations would apply to an Independent Contractor.   Independent Contractors are in business for themselves and must follow the self-employment tax rules, including filing quarterly estimated taxes and filing a Schedule C with their Federal Income Tax Return.    Independent Contractors that you hire must receive a 1099 Tax Form from you, by the end of January, if the amount you paid for the prior year is over $600.00 and the Independent Contractor is not a corporation.

The distinction between an employee and an Independent Contractor also has a legal significance.   Most states recognize the doctrine of Respondent Superior which means that, in most cases, the employer is vicariously liable to any third parties injured by an employee while that employee is engaged in a work or work related activity.

To best determine when a worker is an employee or an Independent Contractor we need to look at the guidelines developed by the Internal Revenue Service.

In the next installment we will look at the specific IRS guidelines.