I recently hired an "employee" to assist in the office with website design and computer repairs while I focus on hosting and sales. Of course my first mistake was a friend of a friend referral and an hourly pay rate.

During the past couple of weeks he is spending more time on social networking sites (AIM, MySpace, Facebook, etc.) rather than completing assignments in a timely manner. We have had a discussion concerning this but doesn't seem to have any effect. I really don't want to fire my first employee after only three weeks and looking for alternative motivation.

How would I go about paying PER JOB on the web design and repair? What would be fair to both me and the employee? This is the only alternative to termination I could think of at this time. I am also placing "parental" controls on the computer to prevent access to social network sites and instant messaging.

Any and all feedback welcomed and appreciated.

I don't know of any states that will allow you to get away with that, and the IRS would definitely not see him as an independent contractor, so you'd be dodging payroll taxes in addition to breaking a few employment laws. If you think he's costing you money now, just wait until he drags you into labor court. Fire him and get it over with.