Are Recording Studio Engineers Employees or Contractors (Part 1)?
Your recording studio is paying audio engineers, specializing in recording, mixing, and mastering. Are engineers the recording studio’s employees or independent contractors? This is part 1 of series on how to classify recording studio engineers as workers. Each part of the series will answer one question and provide guidance to help you decide.
Why does it matter if I treat my studio engineers as employees or contractors?
For engineers who are employees the recording studio must: 1. Withhold taxes from the audio engineer’s paycheck, 2. Pay social security and medicare taxes, and 3. Pay unemployment taxes. For audio engineers who are contractors, 1-3 are not required. Problem is, you can not simply choose the easier option of the two, the IRS has guidelines.
Controlling How an Engineer Works
The degree of control the recording studio has over the engineer, or the degree of independence the recording engineer has is the starting point for determining whether the audio engineer is a contractor or employee. Using the chart below, answer steps 1 through 3.
Step 1: Mostly answer Recording Studio? It is likely the Engineer is your employee, and the opposite is true if you answered Engineer.
Step 2: If you gauge greater than 50% instruction as the recording studio in Step 2, it is likely the engineer is your employee. However, if you provide less detailed instruction it’s likely the engineer is an independent contractor.
Step 3: Yes, the engineer is likely your employee. No, it’s likely the engineer is operating independently as a contractor. If all three steps determined that the engineer is your employee, let’s chat, you may need to get them on payroll asap.
What did this 3-step process tell you about the engineers in your recording studio? Let’s continue the discussion on Twitter!