Contractor Bills Hourly; Maintenance vs. Improvements, ect

[Steven Segal]

Essentially I have a contractor who bills me hourly for jobs. I keep him extremely busy with investment properties - whether it be rentals or flips. Great relationship at this point. 

Currently, he just gives me a weekly bill: 

Jim - X hrs and Y rate

Fred - A hrs and B rate, ect

However, there is no scope attached to it; nothing classifying it as improvements vs. repairs. (Note: I don't have any issue with this and trust him with time.)

Is this something I need to change? Or does a timesheet stand as an invoice? Legally and tax-wise? How to allocate? We have worked this way for about 3 years now. However, I am looking to take a more passive stance in the company to pursue some other things and need to implement changes to make it so it can run without constant input and decision making - need procedures in place.

Also, it is worth noting that he isn't doing any of your large depreciating items - hvac, plumb, electric, roofing... More cosmetic things (like painting) and small things (like changing out lam countertops and tile work). Those things we use other subs for.

The other downside of this setup, which I know, is this type of billing - even if legit - becomes to walk the thin line of employee vs independent contractor. I am thinking about how to deal with this currently.

Any ideas/insight appreciated.