Booster club management don’t often need to hire contractor workers. However, sometimes they need outside services for tasks such as graphic design, accounting services, legal assistance, and more. In a best-case scenario, a member of the booster club can provide these services pro bono (such as with drafting IRS forms and handling taxes).
Club members don’t want to spend too much of the budget on contractor workers, so booster clubs should first seek help from a volunteer with the organization. Both because this is easier when you manage a booster club, but also due to it being financially cleaner.
Hiring outside business requires you to fill out IRS forms, especially if the booster club has to hire contractor workers for more than $600. Yet, sometimes your club will find it’s easier to let professionals handle some aspects of the organization. In this article, we’ll cover everything your booster club should know before they hire contractor workers.
Avoid Conflicts of Interests When You Hire Contract Workers
One of the first things to keep in mind when you hire contractor workers is to avoid any conflicts of interest. According to this article, “booster club embezzlement is a crime of opportunity predicated on trust.” Even though it’s opportune to hire the services of a friend, the conflict of interest opens your booster club to unnecessary vulnerabilities.
In some cases, members of a booster club hire a friend for unnecessary services that fatten the wallets of everyone involves. In light of this, booster clubs need to set boundaries with their members and the school. These efforts can include having the athletic director sit in on meetings, reinforcing a culture of transparency.
Policies to Adopt When Clubs Hire Contractor Workers
One policy to adopt is for your booster club to hire an independent account without ties to any club members. This ensures that all financial transactions are recorded independently from the people making those purchases. Overall, this creates a system of checks and balances that discourages any glaring conflicts of interests when booster clubs hire contractor workers.
However, this decision won’t mean much until it’s written into the bylaws of the organization. Adopting bylaws in the functions of the booster club requires transparency in every financial aspect. While this might sound obvious, many booster clubs don’t think about the pitfalls of everyone operating on unofficial rules.
As long as the board members hold each other accountable, the bylaws make sure the club won’t experience corruption issues as it hires contractor workers. Taking these measures is vital, because when the booster club loses money on unnecessary–sometimes illegal–expenses, the kids suffer the most.
According the National Federation of High School Associations, money stolen from a booster club through embezzlement is rarely recuperated:
“Students [are] deprived of benefits such as the opportunity to travel to compete or perform; to be provided with equipment, instruments or other resources beyond those which the school can afford; to secure financial assistance to mitigate pay-to-participate fees; to receive booster club-provided college scholarships, or to obtain any of the extensive variety of other badly needed forms of support that would have been made possible by the club funds that were stolen.”
IRS Guidelines for Hiring Contract Workers
When a booster club moves to hire contractor workers, there are some guidelines to follow to make sure they’re legally contracted. Contractors, legally, are not booster club employees. The IRS also requires booster clubs to report any payments made to contract workers over $600.
Your booster club needs to file these payments annually on a 1099 form, but at the time of service fill out a W-9 form to keep a precise record. This form also makes sure you have the right taxpayer information and routing numbers for the deposit. As a side note, the treasurer of the booster should handle this process, and keep on file backup scans of necessary financial documents.
A couple guidelines provided by the IRS include the stipulations that independent contractors only receive a profit based on their job performance. This prevents conflicts of interests because the contractor is judged only for their services, not any social connections.
The relationship between the booster club and the employer must also end when their services aren’t required. When you hire contractor workers, you cannot require when, where, and how the job is done. This prevents any money laundering issues by keeping the business relationship legal.
Where You Can Hire Contract Workers
When your booster club needs to hire contractor workers, the internet is a great resource. Websites such as ZipRecruiter and Indeed allow you to post your needs to a job board and sort through the best candidates. These services help expedite the hiring process, while also helping to find contractors without any personal ties to the organization.
Other platforms such as Upwork and Freelancer allow you to find talented freelancers who specialize in helping a variety of clients. These services include legal work, tax and account working, marketing, and graphic design.
These companies carefully vet their freelancers and offer mediation services if there’s any dispute. You can also view prior projects performed by the freelancer on their profile, and judge the best candidate for their reviews.
In conclusion, when a booster club decides to hire contractor workers, there already needs to be a guideline in the bylaws to handle the situation. This involves making sure to hire contractors without conflicts of interests in the booster club. Most often, this takes the form of overcharging for services or even charging services never performed in the first place.
The best way to avoid this breach of trust is to enforce transparency. Inviting the school principal or athletic director to sit on the board enforces this image, as it publicizes the inner workings of the booster club. This also means making sure you know to annually file for 1099 form and filing a W-9 form for each time you hire contractor workers.
In essence, you need to establish a culture of transparency. A booster clubs single function is to enhance the kid’s experience, and basic precautions need to be established so these funds directly benefit them.