Business Owners: Labor question (see details)?

I want to hire an existing employee currently (W-2) tax status as a subcontractor (1099) tax status for odd jobs around our shop for the purpose of helping him through a financially difficult time so he doesn't have to get a second job elsewhere. I cannot afford to pay him overtime on an hourly basis with (W-2) status doing the job he was hired for. So, in addition to that job is it lawful or where can I find out if it is lawful to hire the same person with two different job status from a tax perspective?

The Department of Labor (DoL) typically frowns on this because it looks like you are trying to cheat him out of overtime pay ( sounds like that is not the plan here). The DoL recently reclassified many jobs between exempt and non-exempt status; also state laws may complicate things. The last thing you want is an audit.
Do you use an accountant? He might have some advice.
Could you front him some money and deduct it from future paychecks?
Otherwise you should pay a local lawyer for an hour to give you a correct answer. It may cost a lot, but it's a one time cost unlikely to blossom the way an Unfair Labor Practice could.

I have never encontered this situation but hope that you can cover the "worst" case and prevent any problems.

http://www.businessownersideacafe.com/fi...

http://lawyers.findlaw.com/

http://www.osha.gov/

Legally he is considered an employee as such you have to report his wages on a W2 and pay payroll taxes.
But...
It's highly unlikely you will be raided by the labor department.
So, I say give him a 1099MISC at the end of the year. He reports his income and you declare the expense. Everybody is happy.