Weekly HR News - Employee vs. Independent Contractor (Financial Control)
Employee vs. Independent Contractor
Weekly HR News – Part 3 of 4 (Financial Control)
As stated in the previous article, the determination as to whether a worker is considered an employee or independent contractor is based on three main groups which are:
- Behavioral Control;
- Financial Control; and
- Type of Relationship.
Last week we looked at behavioral control and this week we are looking at the financial control part of the test. Financial control is determined by the facts that show whether the city has the right to control the “business” aspects of the worker’s job. An independent contractor will usually:
- have unreimbursed business expenses;
- have significant investment in the facilities or tools that they use to perform work;
- have the freedom to seek out new business opportunities by advertising, maintaining a business location and being available to work in the market;
- be paid by a flat fee for the job;
- realize a profit or loss in the business;
Next week we will review the last part of the test, which is the relationship of the employer and the worker. For more information on this or any other personnel related matters contact Andrea Shindlebower.
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