The Challenge – Risk Mitigation
Our client, a healthcare provider, utilized a significant number of Independent Contractors and Consultants. TPG provided our client a solution that would eliminate the risks of using these I/Cs and consultants with our Payroll Services solution.
The Panther Group Solution
The basic risk comes from the misclassification of such workers. It is estimated that as many as 70% of individuals working as independent contractors or consultants are misclassified and should be considered normal W2 employees. The IRS has stepped up its audits for misclassifications. If the IRS determines that an independent contractor or consultant is misclassified, then at a minimum, the employer portions of Social Security, Medicare, federal and State unemployment would be demanded from the “employer.” By implementing our solution, we were able to take each person and determine their correct classification and eliminated all of these potential risks for our client.
TPG has provided our client full control and insight into each and every individual that is being used as an independent contractor and consultant with their company along with risk avoidance. Our Payroll Services solution converts ineligible 1099 Independent Contractors and consultants to W-2 status. It provides our client with the adherence to proper classification of workers, the reduction of huge penalties, back tax assessments, interest payments and retroactive benefits, and the avoidance of co-employment issues.