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I don't know how it is in the US - but here in Poland there are companies forcing janitors to open their sole proprietorship to optimize taxes.

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that does sound like US companies that contract out their cleaning services to an independent company. here the motives are a bit different (reduce employee headcount and thereby eliminate unemployment insurance and benefit costs and reduce other liabilities. possible other advantages depending upon workforce eligibility to work legally in the US.)

Can you elaborate? I am genuinely interested in the backstory and/or more detail and the scenario.

It's same in Ukraine, I'd even say tax rate differences are less ridiculous in Poland. In Ukraine personal income is taxed at flat 20% and another 22% of income goes to social security, while sole proprietorship income is taxed at 5% plus 22% of minimal monthly wage (which is something around 150 USD. yes, monthly) to social security. Everybody from IT people to supermarket chains and restaurants abuse this.

Also, since you don't hire people, but contract some other company it's de-facto at-will employment in country with Soviet-era Labor Code still in place.

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