WorldWide Drilling Resource

60 MARCH 2014 WorldWide Drilling Resource ® Drilling Into Money Not Boring by Mark E. Battersby Independent at a Price A recent Department of Labor study revealed a whopping 30% of businesses “misclassified” employees as independent contractors. With the ever-present risk, why do so many drilling professionals - and those who employ them - appear to covet the label of “independent contractor?” Although the benefits to an employer dealing with independent contractors are largely eco- nomic, consider the benefits of working as an independent contractor: 1. You are your own boss - complete with all of the risks and rewards. 2. You may earn more. According to a Wall Street Journal survey a few years ago, independent contrac- tors are usually paid at least 20- 40% more per hour than employees performing the same work. The employer can afford the independ- ent contractor’s high rates because they are not required to pay half of the independent contractor’s Social Security taxes, unemployment com- pensation taxes, provide workers’ compensation coverage, or employ- ee benefits. 3. An independent contractor’s tax bill will be lower. Although independ- ent contractors must generally make periodic estimated tax payments directly to the Internal Revenue Service, they can hold onto their hard-earned money longer before turning it over. Even more impor- tantly, an independent contractor can take advantage of many business- related tax deductions which are largely denied to employees. On the downside of being an inde- pendent contractor, there are a number of factors, including: 1. No job security. Admittedly, an independent contractor is his or her own boss, but it is often a mixed blessing. Employees are usually paid even if business is slow or there is no work. There are rarely costs associated with dismissing independent contractors. 2. No employer-provided benefits. Employers, including many drilling operations, provide benefits such as health insurance, paid vacations, and paid sick time. Independent contractors get no benefits. 3. No unemployment benef i ts. That’s right, drilling professionals labeled as independent contractors can’t collect unemployment when work for an employer ends. 4. No employer -paid workers’ compensation. If a work-related injury is the fault of the independ- ent contractor, there is little or no recourse against the employer. On the other hand, it is not always a bad deal for those calling themselves independent contractors to be relabeled as employees. After all, a worker may receive employee fringe and pension benefits, be entitled to reimbursement for business expenses, entitled to fed- eral and state minimum wage and hour standards, and may receive coverage under nondiscrimination laws, unemploy- ment insurance, and workers’ compen- sation protection. Mark Mark E. Battersby may be contacted via e-mail at admin@ worldwidedrillingresource.com In Memoriam Thomas Raymond “Tom” Karle (1944~2013) Thomas Raymond “Tom” Karle of Lubbock, Texas, passed away on December 7, 2013. Born in Rocky Ford, Colorado, in 1944, his family moved to the Garden City area in 1955. He was an Army veteran, serving in Vietnam. Tom also attended Garden City Junior College and earned his bachelor of arts degree from Ft. Hays Kansas State College. For more than 35 years, Tom worked as a pump specialist with Goulds Pumps in Garden City and Lubbock. Tom is survived by his brother Robert; sisters Kathy and Carol; and numerous nieces and nephews. The management and staff of WWDR express their sympathies to Tom’s family and friends. Healthier Snow Shoveling Adapted from Information by Sharon Liao in Better Homes and Gardens Magazine Before you begin clearing snow, make sure to follow a few smart strategies: Consult your Physician If you are over 50 or have a chronic illness such as diabetes, ask your doctor if shoveling is safe for you. Clearing snow is a Snow Shoveling cont’d on page 64.