To determine whether a worker is an employee or an independent contractor, the IRS has developed a three-part series of factors to be reveiwed.

1. Behavioral Control: Facts that show whether the business has a right to direct and control how the worker does the task for which the worker is hired, including such factors as when and where to do the work, what tools or equipment to use, and the amount of instruction given for individual tasks.
2. Financial Control: Facts that show whether the business has a right to control the business aspects of the worker’s job, including the extent to which the worker has unreimbursed business expenses and the extent of the worker’s investment in the facilities or equipment used by the worker in performing the services.
3. Type of Relationship: Facts that show the parties’ type of relationship include any written contracts describing the relationship the parties intended to create, whether the business provides the worker with employee-type benefits, and whether the relationship will continue indefinitely rather than for a specific project or period of time.

There are many other factors to be considered and each situation must be reviewed on an individual basis. A simple rule of thumb is this: look at what the worker is actually doing, and if they look and act like an employee then they probably are.

For a free half hour consultation regarding employment law issues, please contact Attorney Chris Ratté.

NOTICE: The information and articles posted on this website are for informational purposes only and are not intended as legal advice. Contact me to discuss your particular situation or consult a licensed attorney in your state.

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