HOW DO YOU CLASSIFY AN EMPLOYEE VERSUS AN INDEPENDENT CONTRACTOR?

employee vs. independent contractor 2

Although various employment statutes offer a variety of explanations as to what constitutes employee status versus an independent contractor, two primary criteria distinguish independent contractors from employees.

First, independent contractors agree on the desired work product and then control the means and manner of achieving the outcome. Second, independent contractors offer services to the public at large, not just to one business.

Keeping in mind that all of the factors of a worker relationship must be assessed and weighted and that no one factor is determinative, courts have used the following criteria to determine whether a worker is an employer or independent contractor:

– The nature and degree of control or supervision exercised by the employer
– The extent to which the services is part of the employer’s business
– The amount of the worker’s investment in facilities and equipment
– The worker’s opportunities for profit or loss
– The method of calculating the payment for work (ie- by time worked or by the job)
– The skill and judgment required for the independent enterprise to succeed
– Whether annual, vacation, or sick leave is given
– The intention of the parties regarding independent contractor or employee status.

Workers who are lower paid, lower skilled, lack bargaining power, have a high degree of economic dependence on their employer, and are subject to regular supervision and control are more likely to be considered employees. Workers who have “significant entrepreneurial opportunity for gain or loss,” and retain direction and control over their work, are more likely to be considered independent contractors.

The Law Offices of Payab & Associates is a Los Angeles based law firm with more than 17 years of experience in employment cases. Our office has successfully litigated many complex disputes including wrongful termination, sexual harassment, racial discrimination, wage and labor disputes, and retaliation cases.

Contact the Law Offices of Payab & Associates @ (818) 918-5522 or visit http://payablaw.com/ if you have any questions regarding your rights at the workplace.

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