W-2 vs 1099 cleaners: employees or contractors?
/ comparison
Paying cleaners on a 1099 looks cheaper and simpler: no payroll, no withholding, no workers’ comp. The catch is that you do not get to choose the label. Whether a cleaner is an employee depends on how the work is actually controlled, and on a typical residential round — your clients, your schedule, your checklist — the answer usually comes out as employee.
Our picks
W-2 employee
You set the schedule and the method
Your checklist, your supplies, your clients and your times: that is control, and control points to employment.
1099 contractor
A genuinely independent business
Another company with its own clients, kit and insurance that you hire for a specific job, like carpet or windows.
Ask the IRS
When you are unsure
Form SS-8 gets an official ruling. It is slow, which is why most owners settle the question before hiring.
The test is control, not the paperwork
The IRS looks at three categories of evidence: behavioral control, financial control and the type of relationship. No single answer decides it; the whole relationship does, and a signed “independent contractor agreement” does not override how the work really runs.
Internal Revenue Service, read 2026-10-18
Wage law runs its own test. Under the Fair Labor Standards Act the Labor Department’s position on the date we checked was: 2024 final rule (29 CFR Part 795) in effect; a new proposed rule was announced on 26 February 2026. Your state may apply a stricter test again for unemployment insurance and workers’ compensation.
US Department of Labor, Wage and Hour Division, read 2026-10-18
How a cleaning job scores on that test
Run your own arrangement through the sheet below. Every “yes” in the first two groups is a point towards employment. Most maid-service rounds answer yes to almost all of them, because the business sells a consistent standard — and a consistent standard comes from controlling how the work is done.
Behavioral control
- Do you tell them which homes to clean and when?
- Do they follow your checklist and your method?
- Do you train them or inspect their work?
Financial control
- Do you supply the vacuum, chemicals and cloths?
- Are they paid by the hour rather than by the job they priced?
- Can they make or lose money on the job?
Type of relationship
- Is it ongoing rather than a one-off project?
- Is cleaning the core of what your business sells?
- Do they work for other clients under their own name?
Where 1099 does fit: a carpet cleaner with their own machine, insurance and clients whom you subcontract for one carpet job, or a window company you bring in for a post-construction clean. They price the job, bring the kit and carry the risk.
What each one really costs
An employee costs the wage plus the employer’s taxes and cover. A contractor costs the rate on their invoice — but a real contractor sets that rate to cover their own 15.3% (12.4% social security plus 2.9% Medicare) self-employment tax, insurance and kit, so it is higher than the hourly wage you would pay an employee.
| Cost line | W-2 employee | 1099 contractor |
|---|---|---|
| Wage or rate | Wage (maids mean $17.83 an hour) | Their invoice |
| Social security and Medicare | 6.2% social security and 1.45% Medicare, paid by the employer on top of wages | Paid by them |
| Federal unemployment | 0.6% on the first $7,000 of each employee's wages | None |
| State unemployment | Your state's rate on its wage base | None |
| Workers' compensation | Set by each state (Florida: four or more employees, counting corporate officers and LLC members); cleaning businesses average $114 a month | Their own cover, if any |
| Supplies and equipment | Yours | Theirs |
Internal Revenue Service, Topic 751, read 2026-10-18 · Internal Revenue Service, Topic 759, read 2026-10-18 · BLS Occupational Employment and Wage Statistics, via the BLS public API, read 2026-09-04 · Insureon, read 2026-10-18
The cleaning employee cost calculator turns those lines into a loaded hourly figure you can price against. That figure, not the wage, is what goes into the commercial bid calculator.
Forms, deadlines and thresholds
For 2026, payments to a contractor of $2,000 or more in the year are reported on Form 1099-NEC, filed with the IRS by 31 January. Employees go through payroll: withholding, quarterly returns and a W-2.
Internal Revenue Service, Instructions for Forms 1099-MISC and 1099-NEC, read 2026-10-18
Misclassification is usually found after the fact — a cleaner is injured, files for unemployment, or asks for overtime — and the back taxes, penalties and uninsured claim arrive together. The cost of getting it right is known in advance; the cost of getting it wrong is not.
Moving contractors onto payroll
If your crew is on 1099s today, the clean way out is to start the next quarter with everyone on payroll: register for state unemployment, buy workers’ comp, set up withholding, and put the new cost into your prices before the first payroll runs. Use the pay-rate guide to set the wage, and settle the business structure at the same time with LLC vs sole proprietorship.
If a worker’s status is genuinely unclear, either side can file Form SS-8 for an IRS ruling. It can take six months or more, so treat it as a last resort rather than a plan.