July 16th we blogged IRC 60566/6056 “will prove to be the most cumbersome and costly part of Obamacare.” We wrote: “Employers with part-time, seasonal and variable hour workers (someone working for a company with different job functions/classifications, thus hours under two different pay codes) will particularly have difficulties and will need a managed solution. This makes it more important than ever to properly class workers under either W2 or 1099.
Answer YES to the following and it indicates the worker is an Employee (W2).
- Does the business provide instructions to the worker about when, where and how too\ perform the work?
- Does the business provide training to the worker?
- Are the services provided by the worker integrated into the business’ operations?
- Must the services be rendered personally by the worker?
- Does the business hire, supervise and pay assistants to the worker?
- Is there a continuing relationship between the business and the worker?
- Does the business set the work hours and schedule?
- Does the worker devote substantially full time to the work of the business?
- Is the work performed on the business’ premises?
- Is the worker required to perform the services in an order or sequence set by the business?
- Is the worker required to submit oral or written reports to the business?
- Is the worker paid by the hour, week or month?
- Does the business have the right to discharge the worker at will?
- Can the worker terminate the relationship with the business at any they wish without incurring liability to the business?
- Does the business pay the traveling expenses of the worker?
If the answer is YES for the following questions, it indicates the worker is an independent contractor (1099)>
- Does the worker furnish significant tools, materials and equipment?
- Does the worker have a significant investment in the facilities?
- Can the worker realize a profit or loss as a result of his or her services?
- Does the worker provide services for more than one firm at a time?
- Does the worker make their services available to the general public?