Where does an LMT Get money during a time of crisis, like COVID-19?
You’ve no doubt seen various small business owners requesting the general public pitch in and purchase gift cards for later use, to keep some revenue coming in. These businesses are fortunate that they can also apply for some more substantial-than-usual SBA disaster assistance loans if they need a large chunk of money to keep their rent and bills paid. Yea!
When these business owners get this money, will they be able to help subsidize the lost wages of those LMTs who they’ve had on their staff as independent contractors (aka self-employed)? After all, independent contractors don’t qualify for unemployment benefits, and their bills still need to be paid. There is no government assistance program for independent contractors, other than the welfare line.
At MassageFIX, our staff are all employees who receive paychecks where we’ve already taken out:
- Federal income tax withholding.
- Social Security & Medicare taxes – also known as FICA taxes.
- State income tax withholding.
- Local tax withholdings such as city or county taxes, state disability, and unemployment insurance.
As a legitimate employer, we pay half of their FICA taxes. We also pay unemployment insurance for our staff. They never have to pay this themselves. Doing this allows our LMTs to apply for cash unemployment benefits to keep them financially going during a crisis. Massage therapists can only get this cash because we classify them as “employees,” not “independent contractors.” Here is the unemployment benefits number: 502-875-0442.
Why do we do this?
We do this because it is the law! So many massage businesses unintentionally misclassify their massage therapists as independent contractors. This unfairly puts a heavy burden on the massage therapist at tax time and during a crisis. Kentucky is so serious about protecting worker’s paychecks that they made it a Class D Felony and instituted enormous financial penalties for a business if they are found to have misclassified their workers.
Besides an independent contractor not being able to file for unemployment wages, they don’t have standard worker protections in the areas of overtime, minimum wage, and compensation for injuries, etc.
“Misclassification deprives workers of their hard-earned wages and undercuts law-abiding businesses. Combating misclassification is one of several important steps the U.S. Labor Department is taking to ensure that workers receive a fair day’s pay for a fair day’s work.” David Weil, U.S Dept. of Labor Wage and Hour Division Administrator
“Simply put, misclassification cheats workers, steals from taxpayers, hurts businesses that follow the law, and weakens our economy. Although legitimate independent contractors are an important part of our economy, the misclassification of employees presents a serious problem that is happening at public and private projects all over the Commonwealth.” Larry L. Roberts, Kentucky Labor Cabinet Secretary
The U.S. Supreme Court, the Federal Government, and Kentucky State all agree that a massage therapist is an employee if…….
- If massage is an integral (main) part of the business owner’s business
- If the job is ongoing and not just for a single job or event
- If the massage therapist has little or no investment in the facilities and equipment.
- If the owner of the business has control over the massage therapist’s hours, location, clothes, and appointments (client files)
- If the massage therapist has little or no opportunities for ongoing, documented profit and loss like a genuinely independent business owner has
- If the massage therapist does not have a say in the business’ organization, operation, and initiative in the open market
Misclassification has become the acceptable norm in massage therapy and other like businesses, even with recent governmental crackdowns. If you are a massage therapist who is being left without the financial and work protection you deserve, you can empower yourself today by…
- Helping educate the business owner where you work as to your proper pay classification and ask them to change it
- Searching your town for an employer who will classify you correctly and give you all of the cash benefits and protections your noble profession deserves.
I hope that as massage therapists sign all of the petitions on social media during the COVD19 crisis, that the government will take notice of who’s really asking for money. There is a considerable population of massage therapists still being misclassified and mis-paid. I believe that the real protection and assistance should start at the grass-roots with employers paying the unemployment insurance and half of the worker’s FICA taxes like they are supposed to do.