MYTH #2: There is a ‘Standard Rate’ for Virtual Assistance.

Reality: That couldn’t be further from the truth.  It’s a contractor/client relationship and as such, rates will vary depending on a number of factors.

• The service being offered. Some require investment in continuing training/education.
• Experience – years of experience typically = expertise. Expertise provides tremendous value.
• Some require professional memberships or licenses to be able to offer the service at all independently.  (i.e. Bookkeepers in the UK need to be a member of their local professional association. Or some US states require you to be a licensed realtor to carry out transaction coordination.)
• Costs involved in delivering the service – this extends to things like data protection measures, cyber security measures and liability insurance to protect themselves and their clients, as well as the tools themselves
• Service provider’s self-employed income tax burden
• Location – cost of living can impact how the service provider sets their rates.

There are a number of things that can be safely outsourced outside of the country.  But there are others you really should think very carefully before you do.  For the simple reason – we are independent contractors/businesses ourselves vs an employee.  Employees are typically covered by their employer’s business insurance for Errors & Omissions – but contractors in most cases are not.  As the client – you want to ensure that any contractor you work with has the right systems in place to protect you and your business in the event of a worst-case scenario.  Because let’s face it, the last thing you want to discover is you are out of pocket due to someone else’s mistake and left with zero recourse to recoup those losses.  

Then there’s the privacy/data breach possibility factor.  Not a fun discussion – but a very important one.  Should you be outsourcing out of country or does it include data/personal info that is protected by privacy laws?

This isn’t just about trust – sometimes the worst-case scenario that occurs is completely outside of anyone’s control.

Here are some resources on this topic:

Here is a great podcast on this subject by a VA Industry veteran – Lyn Prowse Bishop of the Virtual Business Show.
https://virtualbizshow.com.au/ep-42-offshore-freelancers-what-clients-need-to-know/ 

Myth #3: There is a “Unicorn VA” that does ALL the things, and does them well.

Reality: There is no such thing as the “VA unicorn”.

In a dedicated assistant role, working part or full-time for one business, the “unicorn” absolutely exists.  In my corporate days, I (and many of my colleagues) were known for having a wide range of skills, and we loved the challenge of learning something new on the job.  But learning on the job (as an employee) doesn’t have the liability learning on the job as an independent contractor does.

In the Virtual Assistant industry, because we are independent contractors, juggling multiple clients with differing needs is challenging enough. Trying to be everything to everyone at the exact same time would be beyond unmanageable.  And inevitably the result will be disillusioned clients with unmet needs.

The “Unicorn VA” is probably a whole lot closer to a multi-VA team or agency vs one single person, unless as stated before they are dedicated to your business and your business only (which isn’t a VA by definition).

WHY?

• There are different levels of liability for the services our industry provides.  You do not want someone handling the social media management or marketing, when they are only qualified for tasks such as invoicing, data entry and customer service support. (My liability insurance would have increased substantially had I added SM management to my services.) Liability aside, Independent contractors ethically should already know how to offer the services they provide.
• In some cases, training and certification is required to offer services commercially vs as an employee.  i.e. in some jurisdictions to offer bookkeeping as an independent – you need to be licensed and registered with their local governing body or association.
• The cost of a Virtual Service Provider’s services can vary greatly by the service being provided among other things (see Myth #2).  You don’t want to be paying premium rates for basic admin, and the service provider certainly doesn’t want to be charging low rates for premium services.

Isn’t not wanting to be the “unicorn” yourself the reason why you started outsourcing projects and tasks in the first place? 

So why would you now expect this from another single individual? 

Especially when they are not dedicated full-time to your business……

Myth #4: Working with a VA is exactly the same as having an employee – only without the tax burden and employment laws.

Reality: The main thing to clarify here is there are clear differences between an employee and contractor role. And these differences are defined by each individual country’s tax authority/labour laws. 

In-the-know service providers do not want to take on the additional burden of self-employment taxes when they are really an employee.  Employment usually includes perks like a lower tax burden and other benefits such as pensions, medical benefits, sick pay and paid time off.

Every business seeking outside help, should be mindful of not getting themselves into a misclassified employee situation.  When a contractor is later deemed by these authorities to actually be an employee it is such a mess for everyone involved.  And of special note – when that employee is in another country than the business who hired – BOTH sides tend to get involved when the red flags pop up.

The main question that everyone needs to ask themselves is:
WHO HAS CONTROL IN THIS RELATIONSHIP?

FOR EXAMPLE:

1. Who issued the contract?
2. Who decided the rate that would be charged by/paid to the Virtual Service Provider?
3. Who decides when payment is made to the service provider?
4. Who set the terms and conditions in the relationship?  And which parties’ jurisdiction applies?
5. Who set the working hours?
6. Who is responsible for training (initial and ongoing), and software/equipment costs?
7. Who decided the intervals that rate increases would be implemented?
8. Is sub-contracting permitted? – and who determines if/when that will happen?
9. And bonus question: If your VA is in the Philippines – are you paying “13th month”?

If the answer to these questions is anything other than “the service provider” for 1-8, and it’s yes to #9……you probably want to consult a tax professional.

Common Resources – Contractor vs Employee Classification
US: https://www.irs.gov/newsroom/understanding-employee-vs-contractor-designation

Canada: https://www.canada.ca/content/dam/cra-arc/formspubs/pub/rc4110/rc4110-21e.pdf

UK: https://www.gov.uk/employment-status/selfemployed-contractor

Philippines Contractors vs Employees:
https://www.wonder.legal/ph/guide/the-difference-between-independent-contractors-and-employees

https://www.remotepass.com/blog/all-you-need-to-know-about-working-as-an-independent-contractor-in-the-philippines

Note that each country provides it’s own guidance and compliance requirements, so if you are working with someone in a specific country – be sure to check the laws where they are located to ensure you are not inadvertently working with an employee when not properly registered in that jurisdiction to have one.

MYTH #5: Potential clients should ask for a resume during the candidate vetting process.

Reality: This shouldn’t be happening for a number of reasons.  Confidentiality and mindset being the main ones.

First, lets compare a VA business to any other service-based business. 

When you call for a plumber or electrician to carry out work at your home or business, do you first ask them to submit a resume before you will consider working with them?  Of course, you don’t. You check they are insured, bonded, and licensed to carry out the services you need.  You likely look at reviews, their website, and ask around for referrals. You sign off on an estimate they provide and work commences.

So, when you want to work with a Virtual Service Provider – unless they are actually your employee – you should approach the relationship as one professional working with another. And as such, requesting a resume isn’t appropriate.

Most entering into the VA industry are transitioning from employment. Resumes are the norm. So being asked for one doesn’t feel out of place. What needs to be understood is providing intimate details on client projects and other client information through a resume would be a breach of confidentiality and perhaps even Non-Disclosure Agreements.

More appropriate choices for sharing background, skill sets and experience are:

• A Portfolio
• Website
• SM business pages
• LinkedIn profile
• Testimonials or recommendations from clients (Or former employers in the early days.)

These are all incredibly valuable tools for any potential client to do their own due diligence prior to ever reaching out for a consult.  It also provides the client with an opportunity to reach out to ONLY a  select few that have been pre-qualified vs having a job posting that receives thousands of responses.

This really is just a shift in mindset for both parties. 

Potential clients need to view the a VA as another professional carrying out a service they need, vs “hiring an employee.”  And on the flip side – the VA needs to present themselves as the INDEPENDENT professional they are, vs exhibiting employee behaviour. 

This gets the relationship off on the right foot, and in my experience goes such a long way towards building mutually-beneficial, long-term business relationships.

MYTH #6: Clients should be providing training to their “VA”.

Reality: Again, this shouldn’t be happening for a number of reasons.  This time, liability and it’s a huge red flag for the tax authorities that you actually have an employee.

Providing training to a contractor is one of the main red flags for the tax authorities that you may not be working with a contractor at all.

Let’s refer to the plumber comparison again.  Would you work with one who had no experience and was learning from a YouTube video as they worked?  I’m guessing not, and here’s why you shouldn’t…..if that plumber does any damage to your home as a result of their lack of knowledge/expertise you have no recourse.

Any repairs for that damage are entirely on your dime.  Same thing would apply to mechanical repairs to a vehicle.  You can choose to use an unlicensed, uninsured mechanic to replace your brakes.  But if they are not properly qualified, and the brakes are deemed to be the reason for an accident – your insurance coverage may be affected.

The exact same logic should apply to any contractor you bring into your business.

Familiarizing them with the inner workings/custom processes in your business is of course expected and highly recommended, but skills training shouldn’t ever be required.

Contractors are responsible for their own training costs including the time investment to compete any training and should be very careful assuming liability for services they are not qualified to offer. Plain and simple – Unqualified contractors are a potential liability to your business.  And you have no recourse when you suffer financial losses or damage to your reputation as a result of someone unqualified and/or uninsured.

Please fully consider your risk level when you begin to contemplate

outsourcing the different areas of your business.