Nail job in America: Some things about salary that the owners need to know
For a long time, there are many Vietnamese nail owners always cover the salary (salary cover method) for their employees because of their demand. Through this way, the employee has to follow the schedule arranged and is paid for a certain money whether she has clients or not. At usual, this method is to apply with the comission that the employee will be given “extra money” if their collection is more than their salary cover.
Almost Vietnamese nail owner living in America still basically believe that it is normal to cover their emplyees’ salary. They believe to their two side agreement. From that, there are a lot of flyers or tiny advertisement show Vietnamese nailshop owner’s way when they want to get more workers. However, it is risky because their ignorance can be violated to Federal and State labour regulations that they will be fined heavily when they are being checked. In additional, salary cover is one of the main cause of Nail Salon worker – owner litigations which have happened recently.
Salary cover – some things that need to know
For the tax duty and labour regulation, the Nail worker can be an employee or self employed/ independent contractor. However, it is not normal such as most Vietnamese Nail shop owner think. It is dependant on the very complex regulation by IRS ( US Department of Labour), and each State regualtion of labour. The Nail Shop owner should distinguish carefully what is “self – employed/ independent contractor” in State rule or Federal rule since its difference.
Tax duty
On the side of tax duty, the worker is considered to be an “employee” when he/she is paid salary following the W- 2 sample so that the owner will get no trouble with IRS or State’s tax office. In opposite, the owner has to demonstrate their worker being “self employed/ independent contractor when they use the 1099 – MISC sample, which they will be tested by IRS or State tax office based on their own set. As a result, the Nail shop owner would be paid the past to present tax and extra heavy fine if IRS or State tax office confirm the worker being employee.
The Labour regulation
If the worker is an “employee”, the owner is obliged to Federal, State and local labour regulation for workers’salary.
Based on the Fair Labour Standards Act 206 and 207, and the State labour regulation through America, “employee” will be paid the minimum wage, and the overtime pay if it has. It is noted that this basic regulation of the Fair Labour Standard Act must be applied to the employee’s profit in all cases of part time or comission share or salay cover. The Nail shop owners still have to make the clear information of working time and pay following the Fair Labour Standard Act within 7 days / per week. More importantly, the salary cover must be more or at least equal to totally regulated working time. It is also more to plus the overtime pay. If the “total” counted is not more than the minimum wage and the overtime pay of the worker, the owner has to pay for the difference.
In case that the Nail Salon owner classifies the worker to be “self employed/ independent contractor” so there is no need to oblige to “employee” regulation. However, the main factor to be an “independent contractor” following to the tax duty as well as the labour regulation is the right to control of the owner to the worker. If the owner has the right to control, the worker would be an “employee”. Therefore, the worker can not be an “offical independent contractor” if they are covered food and daily money by the owner, because it is the signal that the owner has controled their working time and their money.
In conclusion, the Nail Shop owner can cover the salary for “employee” following to the Labour regulation. But the amount must be included the minimum wage and overtime pay counting on their working time. The owner can not conduct the salary cover for “Independent contractor” and they are unable to avoid their mistake.
Some years recently, Nail Shops through America have been tested by the Fair Labour Ministry and State labour offices. Most shops had to pay the heavy fine for their violation when they had been tested, mainly the pay. Besides that, many Vietnamese Nail Shop owners must cost thousands of Dollars because of ligitations of salary. It can be said about Natalie Salon branches in North California, and Envy Nails in some cities in New York State. In South California, a Nail Shop in Orange city has coped with the Vietnamese nail workers’ ligitation for 2 years. It it not only Vietnamese Nail Shop owners but also Mexican and Ecuador’s are sued.
With the present issue, it’s time for all the Nail Shop owners need to understand deeply about the labour regulation and pay issue to make the good preparation for avoiding the violation when they are being tested. In addition, they can also avoid the claims and ligitations from their workers. With the new regulation of AB – 2437 that has been launched and valid at the beginning of 2017, Nail Shop owners in Caifornia need to take care their knowledge to avoid the dark sides. They need to understand one more thing that is no mercy for violatingthe rules/ regulation. In that occasion, the owners have to pay for their fault.
