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contractor. For instance, instructions about time and place may be less important than directions on how the work is performed.

  • Training – if the business provides you with training about required

procedures and methods, this indicates that the business wants the work done in a certain way, and this suggests that you may be an employee.

FINANCIAL CONTROL

These facts show whether there is a right to direct or control the business part of the work. For example:

  • Significant Investment – if you have a significant investment in your

work, you may be an independent contractor. While there is no precise dollar test, the investment must have substance. However, a significant investment is not necessary to be an independent contractor.

  • Expenses – if you are not reimbursed for some or all business

expenses, then you may be an independent contractor, especially if your unreimbursed business expenses are high.

  • Opportunity for Profit or Loss – if you can realize a profit or incur a

loss, this suggests that you are in business for yourself and that you may be an independent contractor.

RELATIONSHIP OF THE PARTIES

These are facts that illustrate how the business and the worker perceive their relationship. For example:

  • Employee Benefits – if you receive benefits, such as insurance,

pension, or paid leave, this is an indication that you may be an employee. If you do not receive benefits, however, you could be either an employee or an independent contractor.

  • Written Contracts – a written contract may show what both you and

the business intend. This may be very significant if it is difficult, if not impossible, to determine status based on other facts.

CHECK THE INTERNET FOR THE FEDERAL LAW STANDARD

Internal Revenue Service: www.irs.gov/pub/irs-pdf/p1779.pdf

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