Which is better?
On fitness forums, including IdeaFit, I have seen this question posted quite frequently:
Which is better, to hire a personal trainer as an employee or as an independent contractor?
In the following weeks, I will attempt to explore this question from different topic angles with addressing the VERY BASICS. However, I would like to get a more in-depth perspective for my own personal knowledge as a gym owner.
I ask for feedback from you, the reader, no matter where you fit in the fitness industry!
I have posted the first of the series on my blog available at:
I personally lean towards the "independent contractor" as a gym owner or as a trainer.
Basically your renting your facility to PT's at a set price. You have a fixed income, less paperwork (1099) and hassle.
The trainers are then responsible for any taxes etc.
I have worked in clubs being an "IC" and clubs as an employee.
When in doubt, consult an attorney and/or accountant, city, county and state laws.
The guidelines are fairly clear as to what warrants an Independent Contractor but not always followed.
Is it an employee wellness center in a large corporation?
Is it a large chain gym that offers benefits?
I agree with Susan. It depends upon the business model.
when I was a trainer at a club, I was an independent contractor (and there were others as well). However, there were also trainers at the club who were part of the fitness staff.
What made it attractive for me and for the club was that I was allowed to train people who were not members. For each visit, they paid a guest fee which became a transparent item on my clients' bill. The guest fee was at a rate that made it advantageous for my client to become members if they were training with me more than a given hours per month. The clients I brought to the club were not those that would have joined on their own, and as such it ended up being a win-win situation to all of us.
This club was a large club but it was independent and locally owned which made such a hybrid arrangement possible.
The 'competition' between the club trainers and myself never was one because I had my own unique set of clients, and it ended up of added benefit to the club because when I was there without a client the club had literally another trainer who members could ask question but they did not have to pay me.
I started training as an independent contractor. The gym owner and neighborhood night school would take a portion of my earnings and only needed a 1099. I was allowed to bring anyone in, also. Too bad the gym closed; now I am looking for another gym.
Pros- not on your paperwork, you get paid for what they do, zero hassle on your part, just verify they have their credentials/insurance and off to the races.
Cons- No/little control over what they do. Can train badly, can fudge their dues, run off with paid clients $ and little you can do to enforce it unless you want to get legal.
Pros- Does what you tell them to do, you can dictate what forms they use to better pass clients from trainer to trainer, uniform the position to easily slide people in and out.
Cons- Taxes, can be a drain on your income if they're unable to contribute a good number of sales
I agree with those who think it has to do with the business model. Each business or organization operates in their own way and rules so they hire employees according to their needs and business model. For example, if I was going to hire a trainer to work for me he would need come onboard as an independent contractor, because I operate a very small business and that is the way it was been set up from the beginning.
I have heard discussions that requiring a percentage of the trainer's fee, requiring the trainer to have the client pay your studio the fee and then paying the trainer, and some other strange systems that appear to be designed to keep the trainer honest/accountable can also result in being ruled an employee/employer relationship.
I would say be clear and either employ the trainer or charge a rental fee of some type. And of course, get legal advice. In the long run it is usually cheaper than paying penalties and lawsuits.