5012 Central Avenue,
California has stricter standards than the Federal government when it comes to determining employee status. They have 11 criteria they use to judge whether somebody is truly an employee or an independent contractor, and failing just one can result in a determination of employee status. Such a determination could result in taxes, penalties, and interest being assessed to the employer. The 11 factors are:
Not established in business. Usually works for a company.
Company hires and pays assistants. Manages company employees.
Available and advertises to public (website). Has business expenses, issues invoices, and has a business license.
Hires, supervises, and pays own assistants.
Can quit or be terminated at will without liability.
Must follow company procedures. Meetings and/or reports may be required.
Services must be rendered personally. Work schedule set by the company.
Responsible to finish work - may face repercussions for terminated contract.
Not required to follow instructions. Uses own professional judgement.
Worker can subcontract to others. Sets own schedule.
Company provides additional training, processes, methods, and/or systems.
No training required. They are an expert in their field
Supervised as to manner and method of performing job.
Work performed for benefit of business.
Work performed for personal benefit of individual.
No financial investment required. Expenses reimbursed.
Worker has financial investment. Assumes opportunity for profit and risk of loss
Time-based rate: hour, week, or other regular basis.
Flat rate, per project or progress payments, retainer, or contingency basis.
Determined by the business. Provided if required.
Worker chooses and provides tools
Services are part of the company's regular business activity.
Services are incidental or supportive of business activity.
Continuous relationship including seasonal, temporary, and/or part time.
Project oriented. Sporadic in nature.
Both parties believe relationship to be of employment.
Both parties believe relationship to be independent.