Episode 70: Essential Hiring Compliance Questions Answered by HR Expert Matt Tipton

Jun 19

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Conquering Workflows & Systems for Bookkeepers & Accountants podcast with Alyssa Lang, founder of Workflow Queen and Magnetic Bookkeeping & Consulting and Matt Tipton, the owner and founder of WhyHR. Episode topic: Essential Hiring Compliance Questions Answered by HR Expert Matt Tipton

Alyssa Lang interviews Matt Tipton, Owner and Founder of WhyHR, an HR firm that focuses on partnering with business owners to assist them in navigating the unknown of having employees. They talk through HR rules and compliance, employees vs contractors, how to decide between hourly or salary roles and so much more.

In this episode you’ll hear:

Why HR compliance is important in deciding between an employee and a contractor
Where to draw the line with controlling a contractors process and time
What and how to pay your employees and contractors and the compliance that comes with it
What bookkeepers and accountants should be hiring team members as
How to avoid penalties and underpaying team members

Resources mentioned in this episode:

⚙️ Clockify

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If you’ve ever felt overwhelmed by the hiring process, you’re definitely not alone. Recently, I had an enlightening conversation with Matt Tipton, an HR expert and owner of WhyHR, who shared some amazing insights on hiring, compliance, and even preparing for time off. I’m excited to share these key takeaways with you—let’s dive in!

Why HR Compliance Matters When Deciding Between an Employee and a Contractor

One of the most common questions I get is about the difference between hiring an employee versus a contractor. When I first started hiring, I thought classifying everyone as a contractor was the way to go. It seemed simpler—less paperwork, fewer taxes, and more flexibility, right? But Matt pointed out that if you control how, when, and where work is done, they’re probably an employee. This was a game-changer for me!

Drawing the Line on Controlling a Contractor's Process and Time

Understanding how much control you have over a worker is key. If you’re dictating their work process, they’re likely an employee. Take my experience, for example. I once struggled with this while setting up my business. A call with Matt and his colleague, Ashley, clarified so much for me. They helped me see that giving someone access to tools like QuickBooks doesn't automatically make them an employee if they control their work process. It's all about the level of control and independence they have.

Paying Employees and Contractors: Compliance is Key

Matt shared valuable advice on pay structures. Whether you’re paying hourly or salaried, you need to comply with state and federal laws. This includes knowing the difference between exempt and non-exempt employees and staying updated on wage laws.

I used to pay my team based on a percentage of client fees, thinking it was efficient. Matt’s insights made me realize the importance of proper classification to avoid compliance issues, especially concerning overtime pay. It's not just about what works best for you—it's about what keeps you compliant and fair to your team.

For tracking hours and ensuring accurate payment, I highly recommend using Clockify. It’s been a lifesaver in managing my team’s work hours and ensuring compliance.

Bookkeepers and Accountants: How to Classify and Pay Your Team

For those in the bookkeeping and accounting world, most bookkeepers should be non-exempt employees due to the nature of their work. This was a critical point that many might overlook.

My first hires were incorrectly classified, and it wasn’t until I spoke with Matt that I understood the importance of properly classifying bookkeepers to avoid legal complications. Trust me, it’s worth getting this right from the start!

Avoiding Penalties and Underpaying Team Members

Making sure you’re not underpaying your team is crucial. Keeping up with minimum wage laws and understanding exempt vs. non-exempt classifications is crucial to avoid penalties.

Preparing for my three-week European vacation was daunting. With five new hires, I was nervous about leaving the business. But with Matt’s guidance, I was able to delegate effectively, making sure everything ran smoothly in my absence. His tips on compliance and fair pay were invaluable in avoiding any hiccups while I was away.

Practical Tips and Takeaways

Know the Difference: Clearly understand the distinction between employees and contractors based on control and financial investment.
Stay Compliant: Regularly update yourself on state and federal wage laws to be compliant and avoid penalties.
Proper Classification: Make sure your bookkeepers and accountants are classified correctly to prevent legal issues.
Plan Ahead: When preparing for time off, delegate tasks and trust your team to handle responsibilities.

Conclusion

Hiring and compliance can be overwhelming, but with the right knowledge and support, you can navigate these challenges smoothly. Matt Tipton’s expertise has been invaluable, and I highly recommend tuning into our podcast episode for a deeper dive!

For more HR insights and hiring strategies, check out WhyHR. And if you’re looking for a reliable tool to track your team’s hours and ensure compliance, Clockify is my go-to recommendation.

If you’re looking for comprehensive support in managing your business, consider joining my Breakthrough program—it’s packed with resources to help you scale and systematize your operations.

Thanks for reading! If you have any questions or want to share your experiences, feel free to drop a comment or reach out to me on social media @workflowqueen. Happy hiring!

About our guest:

Matt Tipton is the owner and founder of WhyHR. It’s at WhyHR that he gets to focus on his passion for partnering with business owners to assist them in navigating the unknown of having employees. That most often includes: compliance training and education, policy creation, and the day to day surprises that employees bring with them.

Additionally, Matt is the creator of the Let’s Talk series that is made to cover the skills gap that we all face in any organization when tasked with leading employees. It’s the Let’s Talk series that has allowed him to be a keynote speaker, regularly covering topics from Difficult Conversations, The Art of Interviewing, Performance vs. Culture, and many others designed to strengthen individuals and organizations of any size. Matt stays active in his community by regularly volunteering with his local Rotary club, OKC Midtown Rotary.

Matt is married to Brook Tipton. Both are proud graduates of the University of Central Oklahoma where he currently serves on the alumni board.

Connect with Matt Tipton:

Check out his website: https://whyhr.guru/

Send him an email: matt@whyhr.guru

Give him a call: (405) 627 6326

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