Interior designers often get confused about whether to hire an employee or an independent contractor because the decision involves several complex factors—legal, financial, and practical—that aren’t always clear at first glance.
In this episode, I break down the pros and cons of both options, including cost, commitment, legal rules, and how much control you have. I also share my real-life experience of hiring interns and contractors to full-time employees, and explain why shifting your mindset from fear to strategy is key to sustainable growth.
I also talk about setting up your business as an S-Corp, protecting your work with contracts, and why thinking like a CEO is key to building a business that lasts.
Tune in now and start building a business that supports your growth.
And if you need help getting your business off the ground and running, join the Launch Your Business Bootcamp. Classes start in July.
Why you’ve got to check out today’s episode
- Get a clear comparison of hiring options to make the right decision for your interior design business
- Learn how setting up your business structure (like switching to an S-Corp) can make hiring easier and more legit
- Set up your design business for long-term success and potential future succession planning
Check out these episode highlights
01:29 Why Hiring Help Becomes Necessary
02:48 Fears and Misconceptions About Hiring Employees
Cost (taxes, benefits)
Management responsibilities
Long-term commitment
Fear of being slowed down
04:16 Low-Risk/Low-Reward of Contractors vs. High-Risk/High-Reward of Employees
04:54 Rebecca’s Journey into Hiring
Started by mentoring unpaid interns from Sacramento State
Hired a friend occasionally as an independent contractor
Eventually hired a consistent part-time designer
CPA recommended forming an S-Corp for tax benefits and payroll structure
Hired her first full-time employee after forming the corporation
Found value in setting up payroll, legitimizing the business, and treating herself as an employee
08:23 Benefits of Becoming an S-Corp
Legitimizes income for loans (e.g., mortgages, cars)
Encourages consistent payroll and business income
W-2 income is more stable than inconsistent sole proprietor income
Helped build commitment between the employer and employee
Created more freedom and allowed scaling
13:15 Advantages of Hiring Employees Over an Independent Contractor
Better loyalty, consistency, and culture development
Clear legal protections via contracts:
Non-competes
IP ownership
Employees cost less per hour than contractors due to tax considerations
Greater control over schedules and workload
Promotes healthy work-life balance vs. overworked contractors
16:47 Legal Considerations (Especially in California)
Assembly Bill 5 (AB5) changed the rules for classifying contractors
Most designers doing core design work must be employees, not contractors
Example: contractors like bookkeepers are okay, but designers typically aren’t
Rebecca’s husband is an employment lawyer and could speak more on this
Emphasizes playing by the rules to avoid compliance issues
18:58 Mindset Shift and Strategic Hiring
Shift your mindset from fear to strategy when considering hiring employees
Hiring employees is an investment, not a risk
Think long-term about succession, scaling, and the potential for selling a design business
Think like CEOs and make strategic decisions for long-term growth
20:37 Practical Tips for Hiring and Managing Employees
Start with part-time employees to ease into the process
Consult with accountants and bookkeepers for setting up payroll and understanding state requirements
Hire assistant designers or office admin assistants as the first employees
Take time to hire carefully and set clear parameters for the role
22:10 Key Takeaways
Don’t let fear block your growth
Employees help build company culture and sustainability
Next Steps
Join the Launch Your Business Bootcamp and launch your design business this summer
Grab your freebies:
- Furnishings Investment Guide
- Remodel Budget and Timeline Guide
- Your Roadmap to a Career in Interior Design
- 3 Things I Wish I had known when I Started my Career
Take a Quiz!
- Find Your Perfect Interior Design Style if you are curious about your design style
- Find Out What Type of Interior Designer You Should Be!
Join the My Design Mentor to kickstart a successful career in interior design!
Check out the best books every interior designer should have here.
Email me at [email protected] if you have suggested topics
DM me on Instagram at @rwarddesign if you have a burning question
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Thanks for listening. I hope this helps you discover if interior design is the career for you. See you next week…