Agency or Network?

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If you’re a new virtual assistant you’ll want to take up the advice of the veterans and join a few networks. I’ve mentioned on this blog before about the ones here in Australia and there are many overseas networks too. You get some great support, encouragement and advice particularly when starting out.

Most networks will offer a discussion board, and for financial members a publicly-available listing on their website, and potentially access to job leads – which will go out to all on the list depending on how the network is set up.

A few things, in my experience, networks should never do:

  • Ask you to assign ownership of your domain name/URL to them;
  • Have you sign a contract stating that you will pay them a percentage or fixed amount on any work you receive through the job lead;
  • Ask you to send invoices for work received as a result of job leads to the network owner for processing (who then takes the above commission before paying the VA);
  • Not have your membership details publicly listed in a directory for access by potential clients;
  • Include in their contract that any work you do that comes through the job leads is to be done in accordance with THEIR code of conduct;
  • Prevent you from engaging someone else to help with the work.

Let me elaborate on a couple of these points.

If you receive work from a network via a job lead and you send your invoice to the network for processing via their CRM system you are no longer in control of the VA/client relationship. Your invoices should be between you and the client – not you and the network owner who then sends it on to the client.

Whilst a code of conduct is important most VAs will have their own and should not be contracted to follow the code of conduct of the network.

All VAs as independent contractors should be in charge of the way they handle their work including whether they seek assistance or can outsource the work to others. This is because you are an independent business owner. If you are prevented this freedom by the network then you’re not a member of a network but potentially an employee of the network.

If the network you are part of does any of these things then you’re working for an agency. Job placement agencies and temping agencies operate in precisely this way – clients come to them, they find the temp to do the work, send them out, invoice the client and then pay the temp out of that. However, the temp is also in receipt of benefits including superannuation guarantee payments. Because for all intents and purposes the above arrangement makes them an employee of the agency – not an independent member of a network.

I’m raising this now because of a recent decision in the Administrative Appeals Tribunal where a translation company has been ordered to pay their contractors superannuation guarantee payments – now and retrospectively. Why? Because the ATO believed the contractors were operating more like employees – and the tribunal agreed. There were a number of factors – too complex to go into here – but the way the translation company was operating was very similar to the dot points listed above.

If you’re a network owner – or if you use subcontractors to assist you in your VA practice – you also need to be careful because this decision (currently subject to appeal to the Federal Court of Australia) can create untold financial problems if you operate according to any of the dot points listed above.

It’s a grey area … and with the position taken towards independent contractors by the current government, a potentially costly one.

©Lyn Prowse-Bishop – www.execstress.com

2 comments

  1. Good points Lyn. I’ve never wanted to be viewed as an agency or employer from the start which is why I’ve always made sure that potential clients have direct access to our VA team members. Nor did I want to get into that messy situation of checking work, taking commissions and so on. Much easier to help guide network members in setting up their businesses and helping them to get direct client contact than remain in the middle all the time.

  2. execva says:

    Absolutely Kathie – same reasons why I have AVBN members publicly available and I don’t get any further involved than passing on the lead to the appropriate member.

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