Employee or Independent Contractor? Eleven Tests for Correct Classification


UPDATE: The Department of Labor has released a memo providing employer guidance for determining whether a worker should be classified as an employee or independent contractor.  Click here for our more recent post.

Should your new worker be classified as an independent contractor or employee?  Review these eleven tests, divided into three main categories, to ensure you are classifying correctly.

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Collaborative Goal-Setting Drives Performance

startup-593343_1280All too often, the process of establishing goals for employees in the context of a performance evaluation slides into an uninspired exercise of just going through the motions, only to provide an easy reference point for future compensation decisions.  But it can instead be an opportunity to inspire your staff to high levels of productivity and achievement.  Accomplishing that can only happen if you take the process seriously, and move beyond some entrenched myths about setting performance goals.

Here’s how you can do it.

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Employee with Back Problems — What Should You Do?

road-sign-808733_1280We hired a small-built man for a job requiring some heavy lifting.  He developed a back problem.  A doctor has told him he should find another job, because of the back problem.  He doesn’t want to quit and lose benefits.  What should we do?

If your Workers’ Compensation has already paid some of the doctor’s bills, it is a clear warning of even ore Workers’ Comp expenses in the future unless you either:

  • Modify the employee’s job to eliminate the need to do heavy lifting, or
  • Dismiss the employee (better to pay unemployment now than to possibly pay Workers’ Comp benefits for the working life of the employee).

For help in modifying the employee’s job, contact a safety consultant or the state office of OSHA. To possibly assist your employee in finding a job, contact your state’s Vocational Rehabilitation office. Proceed cautiously. You don’t want to violate the Americans with Disabilities Act, nor do you want to have a wrongful discharge lawsuit on your hands.

Medical/Sick Leave of Absence and Unemployment Benefits

woman-687560_1280Can an employee leave work claiming sickness and qualify for unemployment benefits? Our employee was pregnant and quit, then had her baby. She now wants her job back. Do we have to rehire her?

A sick, injured or pregnant employee can qualify for unemployment benefits when:

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Is there a legal limit to the number of hours we can work employees in a week?

Generally, there are no legal limits except for some employees in the transportation industry (for example, employees involved in the movement of trains and truck drivers), juveniles and employees exposed to hazardous materials. Labor laws limit the number of hours you can work children each week. OSHA also has exposure limits for persons working in hazardous environments (exposed to hazardous materials). Otherwise, the only limits to the number of hours you can work an employee are what you and the employee agree to when the “contract of hire” is set, or later when mutually modified. Of course, you may owe overtime pay. Check if your state law has any limitations.

Best Questions for Applicants

One way to waste less time in doing applicant interviews — and at the same time improve the quality of your hiring decisions — is to ask applicants the right questions.

You can improve the value of what you learn in interviews by taking time to prepare productive questions.

Don’t ask questions just for the sake of asking and to have pleasant social conversations. Here are some points to consider:

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Pregnancy Discrimination in the American Workplace

pregnant-422982_1280Employment discrimination related to pregnancy has been illegal for decades, since the passage of the Pregnancy Discrimination Act (PDA) back in 1978. The law, which was an amendment to the 1964 federal Civil Rights Act, prohibits businesses from making employment decisions based on pregnancy. This applies to all aspects of employment, including hiring and firing, pay, job assignments, promotions, layoff, training, fringe benefits (such as leave and health insurance), and other terms or conditions of employment.

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