FindLaw | Find a Lawyer. Find Answers.
Are you a legal Professional?
My current location:
Los Angeles, CA
| Change location
| Featured Legal Services | |
|
(562) 435-1426
|
Twenty Factor Checklist to Determine Independent Contractor vs. Employee Status
| As an aid to determining whether an individual is an employee under the common law rules, twenty factors or elements have been identified as indicating whether sufficient control is present to establish an employer-employee relationship. The twenty factors have been developed based on an examination of cases and rulings considering whether an individual is an employee. The degree of importance of each factor varies depending on the occupation and the factual context in which the services are performed. The twenty factors are designed only as guides for determining whether an individual is an employee; special scrutiny is required in applying the twenty factors to assure that formalistic aspects of an arrangement designed to achieve a particular status do not obscure the substance of the arrangement (that is, whether the person or persons for whom the services are performed exercise sufficient control over the individual for the individual to be classified as an employee). The twenty factors are described below: |
| ____ 1. Instructions. A worker who is required to comply with other persons' instructions about when, where, and how he or she is to work is ordinarily an employee. This control factor is present if the person or persons for whom the services are performed have the right to require compliance with instructions. See, for example, Rev. Rul. 68-598, 1968-2 C.B. 464, and Rev. Rul. 66-381, 1966-2 C.B. 449. |
| ____ 2. Training. Training a worker by requiring an experienced employee to work with the worker, by corresponding with the worker, by requiring the worker to attend meetings, or by using other methods, indicates that the person or persons for whom the services are performed want the services performed in a particular method or manner. See Rev. Rul. 70-630, 1970-2 C.B. 229. |
| ____ 3. Integration. Integration of the worker's services into the business operation generally shows that the worker is subject to direction and control. When the success or continuation of a business depends to an appreciable degree upon the performance of certain services, the workers who perform those services must necessarily be subject to a certain amount of control by the owner of the business. See United States v. Silk, 331 U.S. 704 (1947), 1947-2 C.B. 167. |
| ____ 4. Services Rendered Personally. If the services must be rendered personally presumably the person or persons for whom the services are performed are interested in the methods used to accomplish the work as well as in the result. See Rev. Rul. 55-695, 1955-2 C.B.H. 410 |
| ____ 5. Hiring, Supervising, and Paying Assistants. If the person or persons for whom the services are performed hire, supervise, and pay assistants, that factor generally shows control over the workers on the job. However, if one worker hired supervises, and pays the other assistant pursuant to a contract under which the worker agrees to provide materials and labor and under which the worker is responsible only for the attainment of a result, this factor indicates an independent contractor status. Compare Rev. Rul 63-115, 1963-1 C.B. 178, with Rev. Rul. 55-593, 1955-2 C.B. 610. |
| ____ 6. Continuing Relationship. A continuing relationship between the worker and the person or persons for whom the services are performed indicates that an employer-employee relationship exists. A continuing relationship may exist where work is performed at frequently recurring although irregular intervals. See United States V. Silk. |
| ____ 7. Set Hours of Work. The establishment of set hours of work by the person or persons for whom the services are performed is a factor indicating control. See Rev. Rul. 73-591, 1973-2 C.B. 337. |
| ____ 8. Full Time Required. If the worker must devote substantially full time to the business of the person or persons for whom the services are performed, such person or persons have control over the amount of time the worker spends working and impliedly restrict the worker from doing other gainful work. An independent contractor, on the other hand, is free to work when and for whom he or she chooses. See Rev. Rul. 56-694, 1956-2 C.B. 694. |
| ____ 9. Doing Work on Employer's Premises. If the work is performed on the premises of the person or persons for whom the services are performed, that factor suggests control over the worker, especially if the work could be done elsewhere. Rev. Rul. 56-660, 1956-2 C.B. 693. Work done off the premises of the person or persons receiving the services, such as the office worker, indicates some freedom from control. However, this fact by itself does not mean that the worker is not an employee. The importance of this factor depends on the nature of the service involved and the extent to which an employer generally would require that employees perform such services on the employer's premises. Control over the place of work is indicated when the person or persons for whom the services are performed have the right to compel the worker to travel a designated route to canvass a territory within a certain time, or to work at specific places as required. See Rev. Rul. 56-694. |
| ____ 10. Order or Sequence Set. If a worker must perform services in the order or sequence set by the person or persons for whom the services are performed, that factor shows that the worker is not free to follow the worker's own pattern of work but must follow the established routines and schedules of the person or persons for whom the services are performed. Often, because of the nature of an occupation, the person or persons for whom the services are being performed do not set the order of the services or set the order infrequently. It is sufficient to show control, however, if such person or persons retain the right to do so. See Rev. Rul 56-694. |
FAQs
- What does it mean that corporations have "perpetual existence"?
- Can shareholders of all corporations, large or small, transfer their shares?
- How are corporations taxed?
- What type of business organization is appropriate for my business?
- What are the disadvantages of partnerships?
Small Business Center Forms
Cost-effective legal forms to manage your small business.| Featured Legal Services | |
Dynamic Advocates providing optimum service in the most cost-effective manner.
|
(818) 243-5200
|
Providing Exceptional Representation for Businesses. Call Today to Speak with Our Attorneys. 1-888-WHGCLaw (944-2529)
|
1-888-WHGCLaw
|
Business and Corporate Law. Reasonable Rates. The Next Best Thing to Having Your Own Corporate Counsel. Call Now,
|
(310) 203-2249
|
Sponsored Services
Incorporate Online - Legalzoom:
Form a corporation or LLC quickly and easily.From LegalZoom, the #1 legal document service.
Form a corporation or LLC quickly and easily.From LegalZoom, the #1 legal document service.
More Sponsored Services
Incorporate/Form LLC Online:
- Order LLCs or Corporation, Registered Agent, Trademark, or Dissolution Service or buy Corporate Kits & Seals. One stop shopping!
- Order LLCs or Corporation, Registered Agent, Trademark, or Dissolution Service or buy Corporate Kits & Seals. One stop shopping!
Form a Corporation
Legal Ace.com has the turn key online system to make starting a corporation easy and affordable.
Legal Ace.com has the turn key online system to make starting a corporation easy and affordable.
Incorporate Online - Legalzoom:
Form a corporation or LLC quickly and easily. From LegalZoom, the #1 legal document service.
Form a corporation or LLC quickly and easily. From LegalZoom, the #1 legal document service.
Incorporate Online:
LLCs, Corporations, Corporate Dissolutions, Aged Shelf Corporations. We will beat any competitor's price on Registered Agent or Incorporation services!
LLCs, Corporations, Corporate Dissolutions, Aged Shelf Corporations. We will beat any competitor's price on Registered Agent or Incorporation services!