Empowering People
& Revitalizing the Community

Employees (W2) vs. Independent Contractors (1099) Essentials and Resources

Posted on 2/22/2022 by EDTP Coordinator in LAEDA News

Business owners are you looking to grow your workforce, but also are looking to see what your options are and what your state requires? If yes, then it is vital to know about worker classification and employer requirements. Getting in touch with Human resources and a payroll professional will definitely be an essential step toward this process and not just making sure that your employees are safe, but that you and your business are protected as well. At LAEDA’s virtual event, Alumni Networking Event- Employees (W2) vs. Independent Contractors (1099) on Thursday, February 17, 2022 at 6 PM many aspiring entrepreneurs came together to learn about the important aspects of worker classifications when it comes to W2 and 1099 hires.

During this session, we got to meet Sharon Dunkel, Payroll consultant at PayDay Payroll Resources Inc. along with Brett Miller, Vice President Financial Center Manager (Small Business Lender). The aspiring entrepreneurs of LAEDA had many questions about how to hire, what rules and laws they should review, how they should protect their workers and themselves, what kind of relationship should they have with their banker and much more similar questions.

Tonight’s seminar started with Jamila Powell Program Manager- Women’s Business Center going over some really valuable information on what LAEDA and the Women's Business Center does for its alumni of the Entrepreneurial Development Training Program (EDTP) and Women's Business Academy (WBA) programs and then she welcomed everyone who was their attending the seminar. “LAEDA has been here since 1987 and we help our clients in his or her dream of entrepreneurship through the many programs and services we offer.”

Sharon Dunkel has been in payroll for 35 years and she assists companies in start-ups and in payrolls and she is now also working in community relations. She shared seven rules that she follows and the rules are vital to everyday living no matter which aspect of life one may be standing on:
(1) Smile (2) Be Kind (3) Never give up (4) Don’t compare yourself to others (5) Avoid negative or toxic people (6) Make peace with the past and (7) Take care of your health. She explained so much about workers compensation and the difference between Employees (W2) vs. Independent Contractors (1099). Employees are hired by a business under their employment agreement while Independent Contractors are self-employed. Also, state requirements come into play as well when it comes to hiring either of them or just the general hiring process that is why Sharon directed us to the IRS.gov website for more resources and information.

“Workers compensation is important to have because when they are working for you whatever happens to them on the job you are going to be responsible,” Sharon Dunkel explains.

Just like business owners protect their mission and values by hiring the right employees it is essential for businesses to survive and be protected by having workers’ compensation insurance for the employees that work there. Why? This type of insurance helps businesses to avoid the medical expenses and lost wages when employees get injured or sick at the job.

Employees that have W2 are being directed on a daily-basis whereas Independent Contractors that have 1099 are more independent. Sharon Dunkel went over on how important it is to know the right laws and qualifications to not just protect the types of employees, but the business and the owner as well.

“Doing the process of hiring, hiring right, when to hire an employee vs. independent contractors the scary part to entrepreneurs is what will be the cost and how hard the process is,” Jamila added onto the discussion.

This is why establishing a great relationship with your bank comes into play as Brett Miller of Fulton Bank emphasized several times throughout the night.

“Establishing a valuable relationship with your bank even though they may not be able to help you in that moment is crucial because they probably can help you down the line in the future and banks offer a lot of services and or resources for small businesses,” Brett Miller explains.

Brett Miller has worked with Fulton Bank for 16 years and worked with small business owners: “My favorite group to work with are small business owners because they are so passionate about starting their business, which is why entrepreneurs need to get surrounded and running with the right people because that is how entrepreneurs set themselves up for success.”

Brett Miller also went over how there are a lot of things that are customized and based on the type of business when it comes to what Fulton banks offers or helps with and he left his information if anyone has any other questions.

“They keep their employees, they work closely and help so many small business,” Sharon Dunkel said to Brett Miller about Fulton Bank.

“Capital is important to grow your business and you are limited because of the money in your pockets so we have financial literacy classes that we offer here at LAEDA,” Jamila Powell discloses, “along with mentorship as well.”

If you have any more questions and or concerns you can contact the following individuals/resources below:

Brett Miller - Fulton Bank - BrMiller@fultonbank.com. 856-904-5732.

Sharon Dunkel PayDayEmployerSolutions sdunkel@paydayes.com 609-204-0041.

A & R Bookkeeping Tax Service Ryan Grube arbookandtax@gmail.com
Ryan Grube assists small businesses and tax.

Building relationships are vital to being successful no matter which area or step of life an entrepreneur or an individual is taking and along with that so are mentors and resources.

LAEDA offers seminars and short-term courses in various counties of South Jersey throughout the year. A long-term course is also offered three times per year where entrepreneurs receive 72+ hours of training from industry professionals, business planning, and business counseling. The program is free, but you must qualify.

LAEDA welcomes you to join our community of successful entrepreneurs. Visit our website at www.laeda.com or call (856) 338-1177 to learn more.