What Really Happens in the Salon Industry?
A job that gives you freedom in schedule and creativity, considers keeping up with current fashion and trends necessary for success, allows you to make friends with hundreds of great people in your city and gives you a pretty amazing take home salary after a few years of experience and expertise? Sounds pretty great right? Well, it is. And it’s called being a hairdresser.
Within the salon industry, there are so many options for how to create your perfect career. From which type of salon culture to work in to which status of employment you’d prefer. From renting a chair and creating your own schedule to working as an hourly employee for a large chain… So many options!
But what I love about these choices is that they exist. Until recent years, the industry I love was seen much differently than it is now. It was an industry for those who weren’t intelligent enough for college or more traditional careers. It was for women who needed something to do before having children to stay home with. It was supplemental. Even years ago when I was gearing up to enter school, I saw it as just a stepping stone to fall back on. Similar to my great-grandmother dressing hair out of her home in the early 1900’s because she had to make a living, I just wanted an option to support myself should I need it while I was pursuing better options.
You know how that story ended for me. I obviously fell in love. But I think it’s emerging on a larger scale, too. Being a hairdresser is cool. It means you are fashion forward and creative. It means you are nontraditional and self motivated. And having known master stylists in downtown Denver making $100k and national and international celebrity and session hairdressers making half a million a year, for the motivated hairdresser, a comfortable living and way of life is attainable. I love everything about the industry I’ve stumbled into and in an effort to shed some light on the many options that hairdressers have to consider and navigate, I’ve compiled a list explaining each. When I was fresh, I had to learn from a lot of experience, advice and reading and I would have loved to have someone sit me down and explain this information. So for those future hairdressers, this is your guide of what to look for. And for everyone else, this is your peek into the many career decisions of a hairdresser. Enjoy and make sure to check back again next week for part two!
Employee Vs. Independent Contractor
There are a lot of different options when it comes to how you can work as a hairdresser. The two classifications are being either an independent contractor or an employee. Each option has its benefits and disadvantages and also greatly changes the culture and climate of the salon you are in. Having an employment status means that your employer will deduct your taxes from your paychecks, can set your schedule, and can require certain behaviors and actions from you. Basically, when you are on the clock, your time is your employers. Because of this, a salon that only hires employees is one where each hairstylist pitches in with cleaning, folding towels and sometimes even answering the phones. You are expected to be at the salon regardless of what your schedule of clients looks like for the day and while you’re there, you are expected to do what is needed by management. The advantage to a situation like this is that as an employee, your employer must meet minimum wage, insurance and benefits requirements. And you can pretty heavily rely on the salon for walk-ins and to keep you busy as you begin building a clientele. A salon like this would be Ulta or DryBar.
An independent contractor relationship is much different. According to the IRS, if you are hired as an independent contractor, the salon you work for cannot create a schedule for you or require you to wear a certain dress code. You are working completely at-will and the salon you work for cannot specify how you do your job. The downside to this relationship is that an independent contractor is not protected by minimum wage laws, overtime laws and they are required to take care of their own taxes, disability and liability insurance and anything else that is necessary to keep them protected. However, you are entitled to certain freedoms and decision-making that you are not allowed as an employee. Typically, this kind of a salon has many freelance hairdressers who set their own schedule, work by appointment only and are generally independent. Most salon owners in this category will hire a few key employees such as receptionists and assistants to fold towels, clean and answer the phones and the hairdressers are just expected to show up when they have clients on the books. This culture is usually a very self-sufficient, fairly easy going one.
Most commission and hourly salons require a non-compete agreement. Such a contract looks different depending on the type of salon, position within the salon and the state, but the general tone is the same. A non-compete agreement usually maintains that upon leaving a salon, you may not work for a competing organization within a certain radius for a certain amount of time.
Let me first say that I would never work for another salon that requires a non-compete. Every salon I’ve worked for that has required one has been quite dysfunctional once I’ve seen the interior of the organization and the motive and character of those in leadership. I see a non-compete agreement as a red flag that there are cracks in the foundation and once I see them, I should not have to be bound to the organization. Or have to move ten miles away to continue working.
But it is also important to note that a non-compete can mean different things. I’m opposed to a contract that has a hold on my career after I choose to terminate a relationship with a company. I believe that I have control over my future, not any one salon, and they cannot choose my next moves for me. That is why I won’t sign one. However, during a stylist’s time at a certain salon, she will inevitably see important aspects of the company that should not be shared with anyone else or used after termination of her position with that organization to directly compete with them in the future. I believe that is simply a matter of character, though, and can be written into an agreement, but has nothing to do with where a stylist chooses to work after she leaves a salon. Also, some salons have a non-compete clause which states they will not work for a competitor or pursue employment with a competitor while working for their current salon. I obviously believe that is valid as well if both parties agree to that kind of a relationship.
Another important note about these types of agreements is that they are only valid for employees. Independent contractors are clearly exempt from this type of situation as their classification from the IRS states that they are. If you are an independent contractor, the salon you rent or take commissions from has no control over how you work or other clients you work for. And honestly, if a salon is asking for you to sign a non-compete, work as an independent contractor without benefits and work on commission and not a set rate, you may want to consider the slew of red flags anyway. The non-compete is probably the least of your worries.
One of the biggest reasons a salon will require a non-compete is because of client information. A lot of salons see any customer that is serviced in their place of business as strictly their client. Some salons are more reasonable and understand that if a client is a request for a specific hairdresser or the hairdresser has brought the new client into the salon through their own personal marketing efforts, their information can be shared with the hairdresser. I have worked for salons on both ends of the spectrum and again, it truly depends on the environment of the salon. A booth rental salon would expect you to keep your client’s information on file whereas a large chain where 90% of their customers are walk-ins would not allow you to access any information. But what happens when a guest who has seen you for a year and considers you their only hairdresser wants to make sure they have your information in case you move to a new salon?
I’ve had varying opinions on this over the years and from where I stand currently and in light of the fact that I’m much more picky now about how much control a salon has over me, I would say keep your client’s information. Now, that client has to very clearly be a request and regular guest of the specific hairdresser requesting their information and the client has to verbalize that they’d like to continue seeing the hairdresser should they move on; it would certainly be unethical for a hairdresser to keep the information of clients that wasn’t truly their client. And probably in violation of an employee manual or agreement, too.
But the idea is that you can’t build if you don’t have clients. And if you choose to leave a salon, you will have a hard time starting over somewhere new with no clients and your customers will be very upset when you leave them high and dry without knowledge of where you’ve gone. And when they call in to book their next appointment with you and you aren’t there, the salon can say whatever they choose. I’ve had hairdresser friends in this situation several times and their former salons tell their clients that they left the industry and chose a new career, were terminated for bad behavior or just stopped coming in. Seriously, this happens! I’ve had a friend leave a salon I was at and though I knew where she had moved to and knew that this particular guest was incredibly loyal to her, I had to tell anyone who came back in to see her and found that she was no longer there that I didn’t know where she was. It really sucked to lie like that, but to disclose that information would have caused me to get fired. But that’s how seriously salons take the ownership of their guests, request for you or not.
What I would do is collect business cards from your clients as you see them. After leaving, you can call or email them to let them know where you are working from and they can choose to go with you or not. But they’ve willingly given YOU their information and you are not in violation by obtaining their information through company files. And I can’t tell you how thankful clients are when you do this. I recently sent out an email to a list of clients I had from three years ago before I moved out of the Denver area and almost immediately, a previous client responded saying that she was so grateful she had found me again and she booked a haircut for the following week. For me, it’s always about taking care of my clients first and by giving them the option of knowing where I’m working from, I’m making sure they can completely transition in whatever way they choose.
Join me next week for the second part of this inside look at the salon industry. We will finish up by delving into benefits, what a fair commission rate is, requirements for licensing and renewals and the nitty gritty details that you certainly don’t learn from beauty school!