We employ several independent contractors (sales representatives) in new territories to represent our company, essentially our sales materials in their portfolios. For the most part, once compensation terms and amounts are agreed upon, we must remain hands-off with their day-to-day operation. It sure sounds like she may fall under any one of, if not all, the below categories and might even be considered a statutory employee regardless of what they call her. Of course that's my dummy interpretation, I leave our independent contracts up to our accountant and lawyer.
From the IRS:
Quote:
Common Law Rules
Facts that provide evidence of the degree of control and independence fall into three categories:
- Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?
- Financial: Are the business aspects of the worker’s job controlled by the payer? (these include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
- Type of Relationship: Are there written contracts or employee type benefits (i.e. pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business?
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