Weekly HR News - Overview - Employee vs. Independent Contractor - 1/4
Overview - Employee vs. Independent Contractor
Weekly HR News – Part 1 of 4
The status of an employee is very different from that of an independent contractor. An employee works under the control and supervision of the employer. Employers may, for example, direct exactly how employees' work is to be performed. By contrast, an independent contractor is "hired to undertake a specific project but…is left free to do the assigned work and to choose the method for accomplishing it." Black's Law Dictionary 774 (7th ed. 1999).
The IRS formerly used what has become known as the "Twenty Factor" test. Under pressure from Congress and from representatives of labor and business, the IRS has attempted to simplify and refine the test, consolidating the 20 factors into 11 main tests, and organizing them into three main groups:
- Behavioral Control;
- Financial Control; and
- Type of Relationship.
Over the next three weeks, we will look at each of these factors in more detail.For more information on this or any other personnel related matters contact Andrea Shindlebower.
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