Have I been given a good offer?

[Bartolino]

Im hoping to get some good advice from some of those in the know here as Ive not come across this situation before and its clouding my ability to make a good decision!

Ive been offered a position. I think.

Its a mobile coffee cart and, to cut to the chase, its basically operating the vehicle on the owners behalf for 20% of the takings. I dont supply anything, just make coffee and take my cut which, of course, means Im effectively sub-contracting as opposed to being an employee I guess. Could be more specific if need be but thats it in a nutshell.

Ive not come across a commission based situation in Australia before and was wondering whether this was the norm in the art of mobile coffee?

It seems like a good opportunity. Would it something worth taking on or do you think its a bit dodgy?

Your comments would be sincerely appreciated.

Thanks.

[pie_in_ear]

Re: Have I been given a good offer?

If that is the offer be sure you know exactly what the takings are. Id suggest you ask to look at the owners books, or spend a day with him before you make the decision.

[Bartolino]

Re: Have I been given a good offer?

Ive looked at the books and theres an average in takings that would net me around $500 a week nett (not in the hand) based on a 25 hour week.

Of course tax, insurance and super has got to come out of that.

I have the opportunity to do more hours though but, the thought has just occurred to me - if I do well and the hours increase..how do I protect my position? I suppose I cant, can I...

[Dennis]

Re: Have I been given a good offer?

Ive looked at the books and theres an average in takings that would net me around $500 a week nett (not in the hand) based on a 25 hour week.

Of course tax, insurance and super has got to come out of that.

I have the opportunity to do more hours though but, the thought has just occurred to me - if I do well and the hours increase..how do I protect my position?  I suppose I cant, can I...

In that case it would be gross, not nett. Dont forget sick pay, holiday pay, workers comp. Does the principal have public liability and/or do you have personal liability insurance?

And yes, pretty much like any job these days, you dont have any guarantees.

[Justin_Boyle]

Re: Have I been given a good offer?

There is a good chance you wont have to pay your own super. Im pretty sure that there will be arguments about that fact but the law is certainly on your side. When compulsory super came in a lot of employers made their employees become sub contractors to avoid paying super for them. The law has remedied that now.

Justin

[Javaphile]

Re: Have I been given a good offer?

I would suggest that you check with your local/state governmental agencies to see if this position would be considered an employee or self-employed position.

I dont know about in Oz, but situations like this in the US are dealt with differently in different states. In many (most?) states here this would be considered to be an employee position and would not be eligible for being labeled self-employed. At the core of the employee/self-employed determination here are the questions do you own the tools you use (in this case the van and its equipment) and do you determine the hours worked and the route you drive/service or does the person/company youre working for/contracting with set them.

Here in the US as an employee the employer is responsible for paying such things as vehicle and personal injury insurance as well as various taxes. If on the other hand you are considered to be self-employed/sub-contracting you are responsible for paying for all the various insurances and performance bonds as well as paying taxes that are normally paid by the employer. Nor are you covered by unemployment or personal injury/workers compensation insurance unless you take out a policy of your own.

Get as much information as you can from the owner and then take that info and talk to the appropriate governmental office.


Java "Things that make you go Hhhmmm...." phile

[fishinglizard1972]

Re: Have I been given a good offer?

I think you can look at the books all day long, no one who offers you a job is going to give you the option that costs them more. Yeah it might give you an incentive to work harder, but I think if the guy who owns the van thought it would be cheaper to pay you by the hour he would.

[PiccoloLatte]

Re: Have I been given a good offer?

My advice? Get a copy of the contract and take it to a lawyer who does employment stuff.

Just because you think youre a contractor doesnt mean you necessarily are.

[greenman]

Re: Have I been given a good offer?

How many coffees per hour would be produced over the 25 hours worked?

[Bartolino]

Re: Have I been given a good offer?

The basic setup is that I would be operating as a business within a business. That is, I would provide an ABN (on my invoice), the fee being 20% of the takings as opposed to x amount of dollars.

The principal has public liability insurance and the van is comprehensively insured.

I basically provide the service of coffeemaking and driving and thats it. All materials, equipment, upkeep of the car, mobile phone, cards, uniform, fuel, the bookkeeping etc are paid for by the principal.

I dont have any personal insurances (well, ok, health insurance but Ive always had that),

I dont pay any other expenses - all are covered by the principal

The hours are currently set but I can determine hours and routes if I wish,

An hourly rate isnt always the way to go. Ive learned that the hard way (havent most of us?)

Im aware of the situation in the US which is utterly different to its Australian counterpart - and makes me love Australia all the more.

I took info to government dept and was told I was a contractor.

A contract has not been signed as Im still thinking about it.

I have absolutely no idea how many coffees Id produce in 25 hours - life is too variable!

Thanks very much for your comments. Really very welcome - even the cynical ones!  

[blanyon]

Re: Have I been given a good offer?

I guess if you are happy with $24,000 PA (before tax, assuming 4 weeks off per year, and yes you will need it). You also have to remember you dont get paid for public holidays (unless you have events) your pay will go down in the summer and set up and clean up take around an hour per day so make sure you include that in your hours per week. Me I wouldnt do what I do for that much but I have my own priorities to look after. If it is experience you are after and the money is enough then go for it. 8-)

[Coffee2Di4]

Re: Have I been given a good offer?

I personally think $24,000 is still better than Unemployment Benefits! You will probably still fall in the bracket where you are classed as "Low Wage Earner", so would receive incentives at tax time and throughout the year.

I think that, if youre working around your (potential) childrens schedules, doing something you enjoy, that is reasonably low stress, then I say go for it.

I could handle doing something like this, rather than being stuck to a desk all day for 38 hours a week, trying to find time to get housework done, children fed, cleaned and homeworked, etc!

Id just send a cautionary note to have any contract looked at by a Solicitor (ex-legal secretary in me coming out) to make sure there is nothing to hit you for six down the track but otherwise, go with your gut feel.

As an Human Resources Officer nowdays, Id say that if you are in a position to afford to live on that amount of money, go make yourself happy!

Cheers
Di

[t0fu]

Re: Have I been given a good offer?

not sure if this is even negotiable but maybe you should put in a safety condition so even if you run a loss you still get a bit of money for running the van. example 20% or $300 if under a quota. its a big gamble for something thats not urs and so vague

[Bartolino]

Re: Have I been given a good offer?

I personally think $24,000 is still better than Unemployment Benefits!

YES!!!!! As someone who is (and certainly not wanting to be), I agree.


All told, weve worked out that the hourly rate sits at a current average at around $24. Given the nature of the business, some days, depending on the clientele, this can jump a lot higher albeit thats not the everyday norm. The person who has it now runs it as a slow pace. What I get is basically up to me. I like the challenge in that rather than waiting for a boss to hand me $17 per hour for a 4 hour shift and minimal effort.

And when you consider that the local hourly rates for a casual barista/coffeemaker are around $17 here flat (ie no special rates for after 6pm or weekends), and about $15 for permanents, theres not too much disparity there.

Of course, with the changing workplace laws, I realise that these hourly rates may well rise come July.

But ultimately, I am more concerned with any legal issues that might crop up, particularly because I have not operated as a sole trader/contractor before and because Im operating someone elses equipment etc.

Thanks so much for the low turnover clause idea. Thats a good one and Ive written that down for inclusion into the contract.

And thanks again for your feedback. This is great!

[Thundergod]

Re: Have I been given a good offer?

An hourly rate isnt always the way to go. Ive learned that the hard way (havent most of us?)

I wouldnt mind an example of that for my own education please.

not sure if this is even negotiable but maybe you should put in a safety condition so even if you run a loss you still get a bit of money for running the van. example 20% or $300 if under a quota. its a big gamble for something thats not urs and so vague

This I agree with and its an example of when hourly rates can be the go.