Mystery shoppers typically operate as ICs, which provides several benefits to both the mystery shopping companies and to us as mystery shoppers. Recently, both Federal and state governments have been challenging IC status in many industries. Although these actions are not directed specifically at the mystery shopping industry, they will have an impact on all of us.

Although some mystery shoppers like the idea of being employees rather than ICs, they may not like that status as much when their pay is decreased (to cover the mystery shopping providers’ increased costs of carrying them as employees), when they are restricted from working for multiple companies, or when they are unable to deduct their business expenses, such as Internet access, mileage, etc.

One thing we can do to prove we are ICs is to operate as independent businesses and to affirmatively state that we are doing so. There is a new service from Surf Merchants (the folks who brought us SASSIE) to make that easy.

IC Pro is a simple way to inform participating companies that you are an IC. There are lots of advantages to both you and the mystery shopping providers, so let’s take a look…

How much does IC Pro cost?

There is no cost to mystery shoppers to register with IC Pro. You will need a free Jobslinger account.

Which companies are part of the IC Pro coalition?

IC Pro is currently available to the more than 50 companies that use the SASSIE system. Not all of them are using IC Pro at this time, but many are and more are expected to start.

Why should I register with IC Pro?

Many participating companies give preference to IC Pro shoppers when making assignments. They are better protected from challenges to a shopper’s status when using IC Pro shoppers, and the fact that a shopper has registered with IC Pro indicates that the shopper is treating their mystery shopping as a business. Mystery shopping companies like to deal with shoppers who consider themselves professionals, rather than the ones who think the business is all about getting paid to go to the mall.

So, if you are registered with IC Pro you may get more mystery shopper jobs from participating companies.

Is there any reason not to register with IC Pro?

Um…I can’t think of one. I did it.

What do I have to do to register with IC Pro?

Go to http://Jobslinger.com and log in to your account (or create a new account, if you do not already have one). Jobslinger accounts and IC Pro are both free. From your dashboard, click on IC Pro and fill in the requested information. The more complete your profile, the higher your IC Pro score. It took me just a couple of minutes to complete the process and get my 100% IC Pro score.

Is it safe to give them my Social Security Number, or should I get an EIN?

It is safe to enter your SSN on the site. Because these are the folks who run SASSIE, you have probably already trusted them with it many times in the past when you signed up with SASSIE companies.

Getting an EIN can be a good idea if you are concerned about giving your SSN to mystery shopping companies. IC Pro recommends that you get an EIN, but it is not a requirement. If you would like to get an EIN, there is a link from the IC Pro application to the EIN application on the IRS website. It takes only a few extra minutes to get an EIN.

How will I file my taxes if some companies have my SSN and others my EIN? Will I have to file two tax returns?

When you file your income tax return you will list both your SSN and your EIN on the Schedule C you file for your mystery shopping income. The only thing that will change is that you will enter an additional nine digits (your EIN) on the Schedule C, but you do not have to file additional forms or separate returns.

My conclusion was that there are some good reasons for signing up with IC Pro (first and foremost, the possibility of more mystery shops) and not really any downside. So what do you think? Are you going to register with IC Pro?

There isn’t just one answer, so let’s take a look at a few possible scenarios.

If you are preparing a resume that will be submitted to mystery shopping companies, you should definitely include any secret shopping experience you have. (Most companies do not require a resume, but a few may.) Never mention the names of clients, as that would violate confidentiality agreements with the mystery shopping companies.

You generally may mention the names of mystery shopping companies for which you have worked, although it is not necessary. For example, when mystery shopper applications ask about my shopper experience, I say something along the lines of, “I have been a mystery shopper since 1995, and I have performed assignments for many companies including…” and there I name a few of the mystery shopping companies I have worked with most often or most recently.

If you are employed full-time and looking for a new job in your field, you may not want to include your mystery shopper jobs. One reason is that the fewer people who know you are a mystery shopper, the better. Also, some employers might be concerned about your attentions being divided or may not really understand mystery shopping.

If you are applying for a job in a field where mystery shopping is commonly used, however,  it may be a plus that tells the prospective employer you understand the importance of quality customer service. In that case, go ahead and let them know that you are a mystery shopper.

If you have been out of work (e.g., laid off or an at-home mom) for an extended period, including your mystery shopping experience can help fill in employment gaps.

How to Include Mystery Shopping on Your Resume

First of all, remember that you are an independent contractor and not an employee of the secret shopping companies. Do not say you were “Employed by” or “An employee of” the mystery shopping providers.

As a contractor, you probably have worked with several companies. Rather than listing all of them, you could simply say something such as, “Worked as an independent evaluator, assessing the customer experience of a variety of businesses in the retail, banking and hospitality fields.” (Your list of industries should include those in which you have worked, so it might include those I listed as well as housing, senior living, online retail, etc.) Just as mentioned above, do not disclose the names of the clients you have shopped. If the prospective employer asks, let them know that you signed confidentiality agreements that do not allow you to discuss specific clients. Honorable people will respect that you are behaving honorably.

Should You Use the Title “Mystery Shopper”?

You could, but I would probably say something such as Independent Auditor, Service Evaluator, etc. Get your thesaurus out and you will come up with lots of great titles!

In summary, mentioning your secret shopper experience can help fill in gaps in your full-time employment history, and can show that you are knowledgeable about customer service issues. However, if you do not need to mention it for those reasons, you may want to pass. Consider that if you are not hired by the business to which you are applying, you may mystery shop them one day. It’s best that they not know about your undercover activities.

As secret shoppers, we typically work as Independent Contractors (ICs), not employees.

There is not a single factor or test that determines whether a worker is an employee or an IC. Saying that someone is an Independent Contractor does not necessarily make it so. There are several things that regulatory agencies, such as the Internal Revenue Service and state tax departments, consider when determining is someone is an employee or an IC. The rules are often vague, and interpretation is up to the agency making the determination.

The IC relationship is spelled out in the Independent Contractor Agreements (ICA) between mystery shoppers and mystery shopping companies. These agreements define the rights and responsibilities of both parties. ICAs often include language relating to the factors regulatory agencies consider when determining if someone is an employee or an IC.

So what does it mean to be an Independent Contractor?

Some of the characteristics of Independent Contractor relationships are that ICs typically:

• Market their services to the public, or to a number of clients
• Are free to take on the clients and projects they choose
• Get paid by the project, not by the hour
• Provide their own tools and materials
• Are responsible for their own expenses

Additionally, ICs retain control of their work. They choose the clients and assignments they will accept. Although the client can require specific results and impose deadlines on the IC, the IC decides when and how to complete the work.

Companies do not provide Workers Compensation or Unemployment Insurance for ICs. Nor do they withhold income taxes or pay the employer portion of Social Security and Medicare taxes for ICs.

Because they are not considered employees, ICs have all the tax advantages of any other small business. That means that they can deduct reasonable and necessary costs of doing business, such as car expenses, equipment and supply purchases, Internet access, and other expenses, including a home office. This can be a tremendous advantage to Independent Contractors, often outweighing the loss of benefits such as Unemployment Insurance.

Being an Independent Contractor–with the flexibility to work when and where you wish, and with whomever you wish–has many advantages over traditional employment relationships for those people who like having complete control over their work.

EIN stands for Employer Identification Number. You might think of it as the equivalent of a Social Security Number for businesses. Mystery shoppers are not required to obtain EINs, however, many choose to do so. With all the concerns about online privacy and identity theft, mystery shoppers are more likely than ever to want to protect their Social Security Numbers. Having an EIN is one way to do that. Here is what you need to know about what an EIN is, why you might want one, and how to go about getting one. (It’s faster and easier than you may think.)

EINs are issued to businesses by the Internal Revenue Service. They are required for companies with employees and certain other types of businesses. Most mystery shoppers are sole proprietors who work as independent contractors. That means that we are not required to have EINs, but we are eligible.

Why would you want an EIN? Many mystery shoppers are uncomfortable about giving out their Social Security Numbers (SSN) online each time they register with a mystery shopping company. Protecting your SSN is a good idea, because scammers can use it to steal your identity.

Although most companies have secure web sites (I would NEVER enter my Social Security Number or other sensitive data on a site that is not secure.) that is no such thing as data being 100% safe and secure. That is true whether we are talking about applying for mystery shopper jobs online, buying something with a credit card at a local restaurant, or any other way personal data may be used.

When you have an EIN, you may use it in place of your SSN in your business dealings. Most mystery shopping companies will have no problem with you entering an EIN rather than a SSN. You may also use your EIN in other business-related activities such as opening a business bank account and filing your income tax return. Do not use your EIN in non-business circumstances where a SSN is requested, or when applying for a job where you would be classified as an employee. The EIN is only for your business dealings.

EINs are free, and it is easier than ever to get one. In fact, you can apply for an EIN online and have your number in minutes.

Even though using an EIN in place of your SSN provides a measure of protection, if you are concerned about identity theft, you may wish to use a service such as LifeLock. I signed up a while back, and I like the peace of mind they provide.

My wife and I are both mystery shoppers and work for many of the same companies. Recently, due to a serious error she made on a report, my wife’s account with one company was deactivated and they told her that she could not shop for them any more.

I guess I understand why they did that, but they also notified me that I can not work for them again, either. I have always gotten good scores on my shop reports. Can they deactivate my account even though I have done nothing wrong?

Employment law can be complicated, as rules and regulations can vary by state, the number of employees a company has, and even, sometimes, the industry. However, mystery shoppers are independent contractors, not employees, and here the law is very simple.

The independent contractor relationship is governed by the contract between the parties. That means that what the contract says determines the rights and responsibilities of both the contractor and the company engaging their services.

Each time you apply to a mystery shopping company, you agree to the terms of their independent contractor agreement. This is a legal document, so it is always a good idea to read it and save or print a copy.

I read the independent contractor agreements used by several mystery shopping companies, and found that most of them had language such as:

The term of this agreement shall be ongoing until terminated by one or both of the parties. This agreement may be terminated, without cause, by either party.

What this means is that either the shopper or the mystery shopping company can decide to terminate the contract for any reason or no reason at all. The language may vary slightly from one mystery shopping provider to another, but the meaning and intent are the same.

So the short answer to your question is, yes, they can deactivate you. The other side of that coin is that you can stop working for any particular mystery shopping company any time you wish. It can be because a scheduler was rude to you, you do not like the way their web site works, they don’t pay as much as you would like, or you don’t like the color of their logo. Whatever.

Why would they deactivate a good shopper because of something their spouse did? Chances are this would not happen because the spouse turned in a report a little late or made a minor mistake. However, in the event of a major breech (e.g., violating confidentiality, “fudging” the answers on a report, etc.) some companies might be concerned that because the secret shoppers are married, the “bad” shopper could accompany the “good” shopper on an assignment, perhaps doing something to compromise that shop.

My best advice in this situation: Get on with your life. There are hundreds of mystery shopping companies out there, so work for some of them. And have a chat with your wife about her work habits.

Have questions? I’ve got answers. Submit your mystery shopping questions to me at cathy (at) idealady (dot) com. 

The U.S. Treasury has started depositing and mailing stimulus payments to taxpayers. When you receive yours, why not use some of the money to make your mystery shopping business more profitable? That can mean investing in yourself, or in equipment to save time and qualify you for more shops.

Here are some examples of ways you could invest a small portion of your stimulus payment to earn more as a mystery shopper.

One way to invest in yourself is to get training that will make you more valuable to mystery shopping companies. Polish your writing skills by signing up for a seminar or class on grammar or business writing. Many local community colleges and continuing education programs have classes that help you to become a better and more confident writer. When your reports are better written, you may qualify for better assignments and earn more money. Feeling more confident about your writing ability can translate to spending less time agonizing over reports, meaning your effective hourly rate goes up–you get more done in less time.

Another way to invest in yourself is with MSPA Certification. With the new Gold DVD, you can get certified on your own schedule, without leaving home. Order your Gold DVD here. Some companies offer assignments to certified shoppers before others, or attempt to fill as many shops as possible with certified shoppers. Most certified shoppers see more and better mystery shopping opportunities after becoming certified.

Purchase equipment that will be less costly to maintain than current equipment. One of the best examples of this is replacing your ink jet printer with a laser printer. Laser toner cartridges last much longer than ink cartridges, and the cost to print a page is typically less. Although you will spend money on the printer, you will save on the cost of consumables. The price of laser printers has come down a lot over the years, with prices now starting under $100. Chances are, you would save at least that much money by replacing your ink-eating printer with a laser.

Get tools to make yourself more efficient. Mapping software can help you plan shopping routes that will save gas and time. A digital voice recorder (DVR) can make recalling details and writing reports easier. An inexpensive digital camera can qualify you for shops requiring digital photos.

Don’t look at the stimulus payment as money in your pocket for a short time. Invest it wisely, and it will pay dividends for months and years to come.