A community of 30,000 US Transcriptionist serving Medical Transcription Industry

Unemployment pay for ICs? - very unhappy camper

Posted: Dec 30, 2010

Wondering....was forced to change from statutory employee to IC status with federal ID number instead of SS# when MDI-MD was rolled into Transcend. Now, Transcend informs that they are NOT going to be employing ICs after Jan 1, 2011. Would like to apply for unemployment, but am being told by a number of people that is not do-able because wages were paid under Federal ID #, not to my social and I signed an IC contract (under great duress, I might add!)

Anybody have experience with this, can help me wade through this huge mess? Please share your experiences. Bad enough I am looking for work with the bad state of this industry (took 3 pay cuts, lost incentive pay in the last year). Now, to get a new job in this industry means taking yet another hit, less cents per line. Yes, I am one very unhappy camper!

UE for IC's... - NocturnalHooter

[ In Reply To ..]
Your friends are right about IC status not qualifying for unemployment, but you might qualify based on your previous regular employment status with MDI-MD, depending upon how long ago that happened. Don't take your friends word for anything - apply at the unemployment office, and make them be the ones to give you the answer!

Wow, they played that like a fine-tuned piano, didn't they? - sm

[ In Reply To ..]
Couldn't fire everybody outright because they'd have had to pay a lot of UI. So force everybody to become an IC. Since UI is usually calculated based on quarters, maintain ICs for a year. Every quarter now essentially has no qualifying income. Now decide no more ICs. Voila! No more employees, no pesky UI claims.

I would file for UE - RLee

[ In Reply To ..]
and let them give you the answer whether or not you are eligible once you have explained your situation. The UE office does a fact finding interview and upon that interview there will be a determination made. I would also report it to the IRS as others have suggested, and who knows maybe the UE office will report it themselves. When I started collecting unemployment after termination from Transcend - the UE office uncovered that they did not even know I was employed, as Transcend had not been paying any state taxes in my state for a whole year. They did an investigation and contacted Transcend and handled that themselves without any involvement on my part. I would file and let Transcend explain their actions to government officials. Good luck!!!!

Have you been offered the option of employment? - Anon.

[ In Reply To ..]
Not to seem unsympathetic, because I'm not, but I am a little impatient. Of course, IC typically means no unemployment. It is our business to know this Work 101 stuff. We're grownups and it's no longer Mommy and Daddy's job to carry us around.

Having said that, state and labor practices are complex, so definitely at least go file and make them turn you down. Be sure to explain the "great duress."

If you don't just get another job first, which is usually by far the better step. Good luck.

Employment offer? and a question - Grumpy

[ In Reply To ..]
Anonymously unsympathetic said: Of course, IC typically means no unemployment. It is our business to know this Work 101 stuff. We're grownups and it's no longer Mommy and Daddy's job to carry us around.

FYI: I did my homework. It is NOT true that ICs do not get unemployment. Here's how it works: As an IC, one must not only get a Fed ID#, but also file as an S corporation with the IRS. My accountant told me that to create an S corporation costs $500. Then, one must make quarterly filings to all taxing agencies, including unemployment. All paychecks must be deposited into an account, and then the S corp must write a payroll check, drawing against deposited funds. If/when a contract terminates, as in this case, with Transcend terminating IC status, then, the independent contractor must "fire" themselves as an employee from the S corporation in order to be able to file for unemployment.

BTW, the amount one must pay in to the unemployment insurance fund in my area (maybe in others?, don't know, didn't do everybody else's homework) is 2.3%.

This is way beyond Work 101 stuff. I am wondering if other transcription ICs do all this, jump through all these hoops, when they take IC status with a company>

Your accountant is wrong - BTDT

[ In Reply To ..]
You can get a federal ID w/o being an S-Corp.

As an S-Corp YOU are a principal in the company and thereby ineligible for UE. Even if you fire yourself. You can't own a business and file for UE if it fails, which in essence, is what your accountant is saying to you. Think of how many painters, plumbers, etc would be happy to think that.

Your accountant steering you to become an S-Corp was really bad advice, IMO. You can be a sole proprietor with a federal ID (DBA) or your social security number. Anyone who required me to have a fed ID would be an account I skipped. Too much hassle.

I went round and round and ROUND with the IRS regarding this so I'm not talking hearsay or off the cuff. If you own interest in the business, you are not eligible for UE if the business fails.

Losing one of your clients - and that's what Transcend is - doesn't mean you can't go out and get more clients. And like I said, imagine all the small business owners who would love to be on the dole while looking (or not looking) for business.

I'd fire the accountant before I fired myself, and ask for a refund because you wuz robbed ;-)

The other thing where you were really steered wrong is that the Fed ID, you paying into UE (state AND federal) is 1000% unnecessary unless you have employees (yourself not included as I've stated ad nauseum at this point).

Oh and - BTDT

[ In Reply To ..]
while Anonymous was unsympathetic the point was a good one.

If you (generic any MT you) are claiming to be an INDEPENDENT CONTRACTOR this means you are a small business owner, even if all you are is yourself. As such, you should be aware of the cost of doing business, the requirements re filing status, etc, and the rules as to what you are entitled to and not entitled to.

Too many MTs just say "Oh I'm an IC" and really they just mean they don't want to follow employer/employee rules and haven't a clue about the rest.

When you submitted YOUR contract to Transcend, what did it say about terminating your contract? Was there a penalty clause? A predetermined notice length?

I really feel sorry for you, OP, because it just sucks to be in your position. Hopefully, you can put some feelers out and get a new gig - or even an employee gig with Transcend - and won't have to feel the crunch of this action.

BTW- It's end of year and I'd not take my business into 2011 so you don't have to incur further corporate fees.

Question for BTDT - Grumpy

[ In Reply To ..]
BTDT: The other thing where you were really steered wrong is that the Fed ID, you paying into UE (state AND federal) is 1000% unnecessary unless you have employees (yourself not included as I've stated ad nauseum at this point).

Perhaps you misunderstood? We are talking about 2 issues here, getting the Fed ID # and paying into UE. You are correct, you do not need to be an S corp to get the Fed ID #. My question was about how to go about paying into UE as an IC. My accountant told me the ONLY way was to make myself an S corp. YOu are saying otherwise.

Please explain how an IC can make contributions to UE in the event that IC status is terminated.

To Grumpy - BTDT

[ In Reply To ..]
"Please explain how an IC can make contributions to UE in the event that IC status is terminated"

There's no point whatsoever for you to pay into UE as an IC. It won't matter. I paid UE on myself as an employee through my S-Corp for 8 years. (I also had 15 employees.) When the business closed because my final contract went overseas, I had to lay everyone off and I was out of a job (save the doctor's office I still did for a whopping $1000 a month, far below the high salary I'd been drawing.)

If you are a small business owner, an independent contractor, a principal in a business - you are ineligible for UE from any of those positions, even if you've paid in. I spent money on an attorney to fight this. I went round and round with the IRS to fight this. And it's just very clear in their minds. You are not eligible- period.

NOW.... EXCEPT.... (and your accountant has made it so you can't go this route), if you are an IC who meets the criteria for an employee (essentially claim being misclassified) then you could request the IRS reclassify you and go back on the company for UE benefits.

IMO, your CPA has given you incredibly bad guidance.

To Grumpy - BTDT - Billy

[ In Reply To ..]
I think she has a great cause of action against her CPA!

Grumpy - AnnaT

[ In Reply To ..]
I have worked as an IC for three decades and am doing so now. I have the best CPA firm in Northern California, and they have never suggested that I become an S corp. I do, of course, pay quarterly taxes. It sounds to me like some CPA is trying to create extra work for him/herself. I had my contract for clients drafted by a top-notch business attorney. Between the attorney and the CPA, neither one of then talked about S corp, and California is notoriously tough about things like this at the State Tax level. Again, I think someone is trying to make a very difficult problem out of an easy situation. Good luck to the OP.

I didn't have to. - PT

[ In Reply To ..]
I just needed a FED ID#. Never did any of that other stuff. I have joined the forces of the directly employed now while I patiently look for another job.

UE and IC - x-MTSO

[ In Reply To ..]
Going strictly on the law- ICs are not eligible for unemployment. You are considered a "principal" in your business thus ineligible.

HOWEVER

You may be able to show that your job did not change, just your filing status (which you seem to feel you were forced into accepting which I find a little absurd because I'm pretty sure no one held a gun to your head). Given that, I would file and bounce the "prove it" ball into their court.

HOWEVER

If they offer you a position as an employee, you are once again NOT eligible for UE because you were offered gainful employment.

And of course, it's ALL a gray area. So I'd go ahead and apply and see where the body parts land.

To Very Unhappy Camper - Mom of 1

[ In Reply To ..]
I have been around this business a good long time and my best advice is for you to see an labor law/employment attorney who specializes in employees rights. I really think that such an attorney could help you. I say this because a friend of mine at another company (not MDI or Transcend) had a similar situation, went to a labor lawyer who took her case on contingency so she did not have to pay upfront, and she got over 10K. I realize every case is different, but to my non-lawyer ears, this sounds like more slimy tricks from our industry. You might also speak with the Labor Board and the IRS. It is free to do so and, especially under the new scrutiny our president is giving to the mis-use of the IC classification, I bet they would be interested to hear your story. (I personally would love to see the IRS land with both feet on these people.) Good luck.

Just had another thought... - NocturnalHooter

[ In Reply To ..]
In addition to filing for unemployment just to see what happens, you definitely should do what another poster suggested and turn them in to the IRS for abuse of the IC status. If you were an employee status before, they "forced" you to become an IC, but your job description, duties, and demands on you as a worker did not change drastically, then you were effectively an employee, not an IC. The IRS definitely wants to hear from you!

Unemployment pay for ICs? - unhappy camper

[ In Reply To ..]
yeah, yeah. I was a "statutory employee" before, then forced into IC (I did not want to jump through all the hoops/work 20 hour week to be an employee, for benefits that I cannot use). Yes, a friend who is an attorney, works with this stuff all the time told me the same thing that you did, IRS would have a problem with this. My accountant told me the same thing! I have done my homework, but am still getting screwed.

I'm not one of the rock-throwing crowd, but I do - Anon.

[ In Reply To ..]
wonder if there could possibly be the connection suggested between employee to IC then IC to ineligible for unemployment--?? A big question is still whether a large proportion have been offered employee status. Anyone experiencing the same and having the same question might want to get together with OP to discuss.

Looks like the higher pay and IC status didn't last long - for just the MDI MTs

[ In Reply To ..]
I figured they had to get the new Transcend MTs to come down to the rest of us and take away the higher pay and the IC status sooner or later. I wonder how long it will take to get the VR on those new accounts so the pay can go down even further?

They have it all figured out! - Shadow

[ In Reply To ..]
I was also at MDI-MD, now Transcend. Was a statutory employee with MDI, was offered IC or employee status with the merger. Line rate went down with both IC or employee, 1/2 cent for IC, 1 cent for employee, because of benefits. Then, 3 months after the merger, they cut the line rate for IC another 1/2 cent. I was offered an "opportunity" to go employee at the end of this year, but declined. If I didn't want it last year, why do it now?

Anyway, the terms of the "employment" was yet another cut in line rate (another 1 cent/line) for straight text. They also told me that the account I was working on was going to go VR, and that would be paid at 4.5 cents a line!

Checked my paperwork on the IC contract they had me sign. Not only did they require a Federal ID#, but the paperwork clearly states that all unemployment taxes are to be taken out by the "contractor".

Yeah, so good luck with fighting to get unemployment compensation. Transcend apparently has paid big bucks to big lawyers to have this all figured out in their favor. And good luck on finding more work elsewhere. Have been looking. It all stinks. I think I am gonna do babysitting or nanny work. I am certainly not going to work in an office for $10/hour, and at least with being a nanny, I get to hang out with cute babies.

I'm former MDI and recently quit Transcend, thank God sm - Relieved

[ In Reply To ..]
There are still good MT home jobs out there, and recruiters who want your expertise. AND there's hope with this whole off-shoring/VR mess yet - the company who hired me away put me on a large hospital account that's "been there, done that" with save-a-buck offshore and VR schemes, and insists on having it done the good ole fashioned quality way - by US-based humans, straight typing...hopefully the beginning of a beautiful trend.

Beautiful trend - See message

[ In Reply To ..]
I just today accepted a position with an MTSO who are getting a very large account because, after trying offshoring and VR, they were inherently unhappy with the quality of work and decided to return to US-based transcriptionists.

Perhaps it *IS* indeed the beginning of a beautiful trend and hospitals are starting to realize saving a few bucks might be better off pursued elsewhere other than the transcription department.

*Fingers crossed*

Wonder if we're working for the same company :-) nm - Relieved

[ In Reply To ..]
x

Are you saying they went from mostly VR to - straight transcription? Really?

[ In Reply To ..]
That would be a surprising move, all right.

Yes, that is what happened with this hospital. nm - Relieved

[ In Reply To ..]
x

Interesting. Thanks for answering. - NM

[ In Reply To ..]
x

Good MT companies? - shadow

[ In Reply To ..]
Your experience seems to point out that the wheel may turning again, that there is a backlash against the way this industry has been going. That is very reassuring. Glad that you have found a new position.

OK, so now what? - Dinosaur

[ In Reply To ..]
So there are good MT companies. That's good news. But after using Bayscribe for MDI/Transcend for so long, (more than 10 years) am a bit overwhelmed about the whole look for a new job thing. Anybody here willing to share (without flaming me for sounding like I did not do my homework) about the recruitment process, testing, probation periods, general pay scales, etc?

I am particularly curious about technology that places are requiring, cash outlay to start fresh with a new company. Heck, what's the technology required for testing? I have WORD, but probably need a headset/foot pedal, WAV files for testing? FTP sites? Have not a clue. Back in the stone ages, I got a dictaphone tape in the mail, transcribed it and sent the print out BY FAX to the company. I know that things have advanced quite a bit since then. So give me a clue, what am I looking at here? And where can I go to learn more and bring myself up to speed? Thanks for your help.

quick reply to dinosaur - older mt

[ In Reply To ..]
There should be no cash outlay.

Technology REQUIRED for testing is usually none, although it's helpful to have a foot pedal.

Word 2003 is the most often used at this point in time.

I can't imagine an MT not having a head-set but if you get hired as an employee, you should be provided with any equipment you might need (i.e. head-set, foot pedal- not many provide computers these days but some still do).

Many companies have their own proprietary player they use but Express Scribe has a free one should you get to the point where you need one.

I've never had to deal with FTP sites and I've been around :)

The process pretty much is you sign into the company's application, retrieve your voice files, type them in their application, send them in their application. Get your quota. Call it a day.

The MDI/Transcend debacle has made its way around MT hiring cirles. And... - Relieved

[ In Reply To ..]
...didn't you have to buy a foot pedal from MDI when they switched over from phone? Also, there are other nationals that use the Bayscribe platform. Like I said, the MDI/Transcend debacle has made its way around the MT business community and you may be pleasantly surprised, as I was, at the understanding you'll get when you just mention MDI/Transcend in the same breath. The company that hired me didn't even make me test and, in fact, has hired several of us defectors. They looked at me as a professional...like any other profession!...saw my years of experience detailed in my resume, and offered me the job based on my stated qualifications.

Just like you, I was hesitant to leave after so many years and reaching a comfort zone. I can tell you that I feel light as a feather, and checking e-mail is a joy now that I don't have to brace myself for nasty-gram threats about making mistakes in their non-user friendly time keeping program or boorishness from CB and the likes of her in their management ranks.

Feeling better! - Dinosaur

[ In Reply To ..]
Thanks everyone for the feedback and support. Yes, I am a dinosaur. See posts on tech board. I have been using Lanier, so yes, I have a head set, attached to the Lanier! Thanks for the perspective on the MDI/Transcend thing. Yes, boorishness, CB, etc. Well, I have another name for her. I call her CF, followed by the rest of her last name. (Those in the know will get it, and those who don't, won't). Nasty-grams. Love that term. Thanks again for the info and perspective

:-) Glad I could help. Your skills are valuable and in demand. Don't ever forget that. nm - Relieved

[ In Reply To ..]
x

Oh, I envy you! - PT

[ In Reply To ..]
Sounds like a truly good company to work for! Congrats. I'm in the same boat, ex-MDI, now Transcend. I really like the Bayscribe program, and I didn't realize it was used by other companies. I'd love to work for another company that uses it. I think it's a great platform. I've been transcribing 20 years, and I'd really like a job with a reputable firm, one where I can STAY PUT!

That would be great! - PT

[ In Reply To ..]
I truly hope it is the beginning of a trend. Even with all this downsizing and paying MTs the smallest amount they will reasonably accept, I wonder if there are ANY companies who still believe in paying top quality transcriptionists what they deserve, say 9 to 10 cpl? It isn't right to bundle really good, as well as mediocre MTs into the same cpl rate. It makes a person feel like there is no incentive to continue to go above and beyond in ensuring quality and no errors.

Was anyone "forced" by Transcend? - PT

[ In Reply To ..]
Was anyone "forced" into independent contractor status? I wasn't. I was given the option of becoming an employee with a pay cut of 1.5 cpl, so I chose independent contractor status at my same rate of pay per line. Then, 9 months later, I was "forced" either to be terminated or become a direct employee.

"Forced"? - very unhappy camper

[ In Reply To ..]
PT, are you saying you weren't "forced"? The offer was employee status right away (with a cut) or IC status (I also got a cut then, but a smaller one, only 0.5/line). The employee status came with a bunch of other conditions, in addition to the pay cut, that was not atractive. Frankly, it was very little carrot and lots of stick. Some option!

Yet here we are 9 months later, IC status is being terminated or you can become an employee....Yes, that is also my story. And you don't feel "forced"? OK, maybe masterfully manipulated is a better term! So, PT, tell me, are you gonna terminate or are you going the employee route?

Guess the -not foreseeable future - - has arrived

[ In Reply To ..]
slowly but surely. Remember how some of the Transcend people posted in response to the MDI MT questions and fears that weren't we so special, that they didn't have the options MDI MTs were being given. Well, not so special, huh, just needed to keep accounts flowing smoothly during transition without mass exodus of rats from the ship while the plan unfolds.

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