Managing a salon with multiple locations
Managing a salon with multiple locations comes down to three decisions made once for every salon: how each stylist is classified (employee or booth renter), how commission and tip pay meet federal wage rules, and which weekly numbers every salon reports. Get those right and the rest is a shared schedule, a product count and a front-desk cash count run the same way in each salon.
Decision 1: employee or booth renter, the same way at every salon
The IRS decides worker status by the degree of control and independence, with evidence in three categories: behavioral (does the business control what the worker does and how), financial (are the business aspects of the job controlled by the payer, including pay, expenses and tools), and type of relationship (contracts, employee-type benefits, permanence). The US DOL treats it as misclassification when an employer treats a worker who is an employee under the FLSA as an independent contractor, and points to 29 CFR Part 795 for the test.
| Question (IRS category) | Points toward employee | Points toward booth renter |
|---|---|---|
| Who sets the stylist's hours? (behavioral) | The salon schedule | The stylist |
| Who sets service prices? (financial) | The salon menu | The stylist |
| Who buys tools and product? (financial) | The salon | The stylist |
| How is money paid? (financial) | Salon pays the stylist | Stylist pays the salon rent |
| Benefits, ongoing role? (relationship) | Yes | No |
Setting a stylist's hours is the kind of control the IRS's behavioral question asks about. Decide each stylist's status before building a shared schedule, and treat the same arrangement the same way in every salon.
Decision 2: commission and tip pay
For commissioned employees of a retail or service establishment, the FLSA Section 7(i) overtime exemption applies only if the regular rate exceeds 1.5 times the applicable minimum wage in any week with overtime, and more than half of total earnings in a representative period are commissions (US DOL Fact Sheet #20, revised July 2008). The fact sheet does not name salons, so confirm your salon qualifies as a retail or service establishment before you rely on it.
Example: at the $7.25 federal minimum wage, 1.5 × $7.25 = $10.875. A stylist works 44 hours and earns $640, of which $420 is commission. Regular rate: 640 ÷ 44 = $14.55, above $10.875. Commission share: 420 ÷ 640 = 65.6%, above half. The rate test is met for that week; the commission test must hold over a representative period (one month to one year), not one week. If your state minimum wage is higher, use it in the rate test.
For tips, the FLSA defines a tipped employee as one who customarily and regularly receives more than $30 a month in tips; the minimum cash wage is $2.13 an hour and the maximum tip credit is $5.12 an hour, and managers and supervisors may not receive tips from a mandatory tip pool (US DOL Fact Sheet #15). State law can set higher figures.
Decision 3: the weekly sheet every salon fills in
| Column | Source |
|---|---|
| Service sales | Booking/POS report |
| Retail product sales | POS report |
| Stylist hours scheduled vs. worked | Schedule and timesheets |
| Chair hours booked ÷ chair hours open | Booking system |
| Front-desk cash over/short | Daily drawer count |
| Color and retail stock variance | Weekly count vs. system |
Example: 4 chairs open 9 hours a day for 6 days is 4 × 9 × 6 = 216 chair hours. 162 booked hours ÷ 216 = 75% utilization.
Stylist schedule template (two salons, one week)
| Stylist | Home salon | Mon | Tue | Wed | Thu | Fri | Sat | Weekly hours |
|---|---|---|---|---|---|---|---|---|
| Stylist A | Salon 1 | off | 9–5 S1 | 9–5 S1 | 12–8 S2 | 12–8 S2 | 9–5 S1 | 40 |
| Stylist B | Salon 2 | 9–5 S2 | off | 9–5 S2 | 9–5 S2 | off | 9–5 S2 | 32 |
| Front desk C | Salon 1 | 9–3 S1 | 9–3 S1 | off | 9–3 S1 | 9–3 S1 | 9–3 S1 | 30 |
A stylist who works in two salons appears in one row with both salons, so the weekly total includes every hour. Assistlify assigns staff to one or more locations and also handles the front-desk cash count and product stock count per location; see multi-location scheduling. For counting the front-desk drawer, use the cash drawer count tool.
This is general information, not legal advice. Check your state labor department for current rules.
Questions
Are salon booth renters employees or independent contractors?
It depends on control: the IRS weighs behavioral, financial and relationship evidence, so a renter who sets their own hours and prices and pays the salon rent points toward contractor, while one on the salon schedule points toward employee.
Do commissioned stylists get overtime?
Under FLSA Section 7(i), not if they work for a retail or service establishment, their regular rate exceeds 1.5 times the minimum wage, and more than half their earnings are commissions (US DOL Fact Sheet #20).
Can a salon manager share in the tip pool?
No; US DOL Fact Sheet #15 says employers may not allow managers and supervisors to receive tips from a mandatory tip pool.
What is the tipped minimum cash wage for stylists?
Under the FLSA it is $2.13 an hour with a maximum tip credit of $5.12 (US DOL Fact Sheet #15); state law can set higher amounts, so check yours.
Sources
- IRS: Independent contractor (self-employed) or employee? (updated 19-May-2026) (checked 2026-11-12)
- US DOL: Misclassification of employees as independent contractors under the FLSA (checked 2026-11-12)
- US DOL Fact Sheet #20: Employees Paid Commissions by Retail Businesses (revised July 2008) (checked 2026-11-12)
- US DOL Fact Sheet #15: Tipped Employees Under the FLSA (checked 2026-11-12)