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Associated Benefits and Risk Consulting - Compliance


Independent contractors part 4: The IRS view

Knowing that life’s only two certainties are death and taxes, let’s turn our attention to how the IRS determines independent contractor status. Previously, the IRS used to apply a 20-factor test to determine whether or not an individual could be classified as an independent contractor. A number of years ago they moved to what they call a “common-law” test that focuses on the degree of control the business exercises in achieving its purposes versus the degree of independence the worker has to actually perform the tasks themselves.

As described in IRS Publication 15-A, the IRS will closely examine each of the following three areas:  “behavioral control, financial control, and the type of relationship of the parties.” Let’s take a look at each.

Independent contractors part 3: Wage-and-hour laws

The Federal Department of Labor (DOL) and its related state agencies are charged with making sure that employees are given the modern-day equivalent of an honest day’s pay for an honest day’s work. Employers who fail to do so can be subject to back-pay claims, penalties and attorneys’ fees.

Developing performance goals for remote workers

When we talk with employers about employee performance, it’s usually a discussion about how to handle an employee that is performing poorly or unexpectedly. These concerns have been exacerbated by the distance created by remote workplaces. However, many of these issues can be nipped in the bud by proactively focusing on performance goals that best suit remote workplace needs.