Crew salary

No, not industry standard. Please elaborate on the situation that led to your question.

And the yacht owner is trying to hire you as a captain and expecting you to do that?

I would assume you don't even have a company, nor do you know anything about US employment laws or have the insurance and everything else an employer should have in place. Do not do it.

Plus, what if owner didn't pay you on time. You'd still be responsible to the crew. Very slippery slope.

Run. Is this a US flagged boat you're talking about? A US owner?

Very interesting that 3 respondents to the survey do just as the owner is describing and employ the entire crew through their corporation or LLC. Now, that does give the captain one advantage and that is he can make a profit on their work as well, assuming he charges enough to do so. It would also give the Captain full control and authority and prevent any surprises hired by the owner or the owner's business manager or someone else other than himself.

The big negative I see is a substantial financial risk and, if I was the captain doing so, I'd want the majority of my fee up front. It's one thing to have your own pay at risk, but to have the pay of an entire crew that you're paying at risk of not being paid to you is a major concern.

For those having a difficult time reading what he posted, here are some key numbers. 69.5% of those captains responding employ only themselves in their corporate entity. 25.4% do employ some other crew. Now, that may simply be their spouse who crews with them or a child. I'm assuming the balance who employ other people just employ locals such as maintenance or cleaning people.

Then among the 25.4%, they had three persons respond that they employed the entire crew of the yacht they were on through their corporate entity (including LLC's). Two of those three are on 80-100' boats so it could be family or not. The other is on a 120-140' boat so clearly a larger number of people.

There was also the question of whether the captains run the expenses of the boat through their own corporation. 79.4% said they do not. Still that left 20% who apparently do. Now, that may simply mean they cover some and get reimbursed, but it's still financial risk. I would have thought that all yacht owners provided credit cards for any permanent captains and other crew to use.

I see this as more of a disturbing trend as many yacht owners are not quick to pay and 30 days of expenses of a boat could be a very sizable amount and significant to most captains. Let's take the 120-140' and assume a crew of 7 and payroll and fringe benefits could easily be $30k for the other 6 or $40k for the seven of them. Add to that provisions and food and fuel and docking for 30 days and you could be in the $100k-150k range in total very quickly. I don't see most captains wanting to carry those receivables. To do so, one should certainly get a substantial markup on all items.

Nothing is said about how or the frequency of payment.

I don't see where I was condescending toward you, just warning that I see the practice as very risky and am disturbed that a yacht owner is requiring such. I personally would not do it. I just see it as a strange new concept. Edit: Well, I do see now and apologize for that.

If I did it, I'd want pay up front and/or significant guarantees. Just because people own yachts doesn't mean they can be trusted to pay promptly if at all. This is an owner passing a lot of responsibility and exposure on to a Captain.

If it was a short trip with a crew of yourself and one more, then ok. But I read it as being more permanent and a crew larger than that.

We used to fly the skipper on the private jet to Switzerland to pick the wages up.

Slacker....

There was another very significant question. While many captains are engaged by the owner through their corporation, very few of those were paid extra for that. So, the boat owner reduces their total costs by having no payroll tax obligations and the captain nets less because they now do have payroll tax obligations.

You add social security and medicare taxes, toss in unemployment taxes and then worker's compensation and you've got a sizable amount before even considering other insurance or benefits.

In most businesses, contractors get paid more per day than employees do. The business owner has passed certain costs to the contractor and has reduced their costs.

As there is only one captain of a boat over 100' reporting that he does employee the entire crew it's hard to reach any conclusions. However, I'd advise any captain being asked to pay for other crew or to pay boat expenses to be sure you're covering all the costs of doing so plus making additional profit for providing those additional services.

I would love to hear from any captains who are covering all crew and all expenses of the boats they operate.

It is not normal. Generally the owner pays each crew member directly (or their corporation does). If I was paying the crew directly, I'd want the money for at least a month up front from the owner AND I'd want to make a profit on it for the hassle. Perhaps the country they're in makes it very difficult to pay the crew directly and much easier to transfer funds to a business.....but if US owner and US boat in US, I find it REALLY ODD.

That being said, I own a Yacht Management business and put out thousands and thousands for various owners and carry it till the end of the month and bill them. But I do have one owner who sends me a good chunk of change up front and I work through that and then tell him to send another check when I need more.

You mention the owner's other businesses and properties. That brings up a thought on what could also be part of what led an owner to do this. There are trends in business toward farming out entire departments. First, came payroll, but now I've seen businesses farm out all of IT to a firm or all their equipment installs for customers. I've never agreed with the philosophy but others like it.

So, it could be keeping with that. One other reason the owner might not want the crew on his corporate payroll, although easy enough to set up his own separate entity. He may have a lot of employee benefits he doesn't want the crew to receive.

I fear owners going into this type arrangement to save money. Well, that has to come at someone's expense, either the captain's or the crews'. That concerns me if I'm the captain.

If the owner simply was doing it to simplify his life and willing to up the total cost by adding profit to the captain to cover his additional work and costs, then I think it's workable. I just don't think that's likely what the owner was thinking.

My first question of an owner would be why are you doing this? My second would be "you do understand it's going to increase your costs slightly?"