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Education

benefits of employment but have In the long-term, the legal strategy of an ISO becomes a further embodiment of
the potential to be the masters of the ISO's culture. So pick a culture you like, as it will permeate throughout your
their own destiny, setting their own business in all of its ups and downs.
schedules and soliciting merchants In publishing The Green Sheet, neither the author nor the publisher is engaged in rendering legal,
how and where they wish, etc.
accounting, or other professional services. If legal advice or other expert assistance is required,
Sometimes an ISO signs MLSs using the services of a competent professional should be sought. For further information on this article,
paperwork that reflects independent please contact Adam Atlas, Attorney at Law by email at atlas@adamatlas.com or by phone at
contractor status, but the agents may 514-842-0886.
actually be employees in the eyes of
the law, based on criteria set forth
by the IRS. An explanation of these
criteria is available at www.irs.gov/
newsroom/understanding-employee-vs-
contractor-designation. This mistake is
common among ISOs. It's best to get
the designation correct from the start
to avoid difficulties later.

I've found that the largest, most
successful ISOs have consistently
built sales forces comprised of
employees, not independent
contractors. Employees can be
controlled more effectively; more
closely monitored; more easily
trained within a captive workplace
environment; and more easily
motivated by factors other than raw
compensation, including perks like
titles, office accommodations, office
culture, etc.

3. Home-made versus
lawyer-written agreements

Regular readers of The Green Sheet
will know I do not use this column
to plug lawyers or legal services. But
I must say that I rarely see a non-
lawyer-written agreement serve the
intended purposes of the ISO that
created it. Some ISOs believe they've
either been around long enough to
write their own agreements, or they
haven't been around for long, but
have great templates.

In both cases, the ISO may wish to
start from a preferred document,
but should engage an experienced
fintech lawyer to check their work.
Subtle issues, for example, survival
clauses and language being binding
on affiliates, benefit from fine-tuning
that is well worth the expense of a
lawyer.

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