LEGALITIES

Independent Contractors vs. Employees ◦ Personal trainers working in clubs are: ◦ Independent Contractors ◦ Employees ◦ Personal trainers that are self employed are usually ◦ Independent contractors

Facility Owners ◦ Do not have to provide: ◦ Expense of training ◦ Medical benefits ◦ Social security withholding ◦ Worker’s compensation ◦ Unemployment coverage

Benefits to working as an independent contractor ◦ Choosing when and where to work ◦ Charging variable fees for different situations ◦ Having professional freedom in conducting work

Legal Tests 10 legals tests to determine if whether someone is an employee or independent contractor: ◦ 1. How much control does the employer have over the work performed? ◦ 2. Are you paid by the hour or the job? ◦ Hour = employee ◦ Paid by service = independent contractor ◦ 3. How long have you been employed at the establishment? ◦ Short term = I.C. ◦ Long term = Employee ◦ 4. How much training do you require? ◦ Already have specialized skills or training = independent contractor ◦ Employer provides training to a recently hired person = employee ◦ 5. Do you provide service to more than one business or client? ◦ Yes = independent contractor ◦ No = employee

Legal Tests ◦ 6. Who provides the equipment? ◦ Your own = independent contractor ◦ 7. Is the work integral to the business or is it supplemental? ◦ Integral = employee ◦ Supplemental = independent contractor ◦ 8. In other clubs, is the work traditionally performed by an independent contractor or an employee? ◦ Current practices may help determine ◦ 9. What did the club and the trainer (you) intend when they made their agreement? ◦ 10. Is the employer engaged in business? ◦ If a client hires a trainer to perform personal trainer = independent contractor

Contracts ◦ In order to get paid for the work you perform you need a contract. ◦ The following elements make a binding contract: ◦ An offer and acceptance with a mutual agreement on terms ◦ Consideration – an exchange of valuables ◦ Legality – acceptable form under the law ◦ Ability of the parties to enter into a contract with respect to legal age and mental capacity.

Included in contract ◦ Every contract should include: ◦ Identification of parties ◦ Description of services ◦ Specification of compensation ◦ Confidential relationship ◦ Business or employment status ◦ Term and termination

Business Structure ◦ How are you acting? ◦ Individual? ◦ Corporation? ◦ Employee of fitness centers? ◦ Independent ◦ Sole Proprietorship ◦ Partnership ◦ Corporation ◦ Sole Proprietorship ◦ Sole proprietorship ◦ A business owned and operated by one person ◦ Owns all assets and is responsible for all income, losses, and liability ◦ Completely responsible for all liabilities, court awards, or damages incurred by the business.

Partnership ◦ Two or more people who agree to operate a business and share profit and losses may form a partnership. ◦ General partnership : All partners are fully liable for the actions of the business. You are also liable for all debts. ◦ Limited partnership : law usually prevents limited partners from taking an active role in managing the business.

Corportation