What is the difference between an Employee and an Independent Contractor?
There are 20 questions to try and make a determination about whether the position is suited for an employee or an independent contractor. (Listed Below)
At QBO, to start, we first look to see if the position will have set hours working at a set location. If it does, this is an employee. Next, we look at control. How much control the supervisor or the boss has over the person doing the job? If the level is significant, this is likely an employee. Those positions that require extensive training and close supervision, again, this is an employee.
Finally, we look at whether the person filling position, can or does work for other people. If they do not, they are probably an employee.
So then what constitutes an Independent Contractor?
An independent contractor, generally sets their own hours. They work from a location of their choosing, i.e. an office, the company office, Starbucks, their house, wherever, their decision. They will send you invoices with their logo on it. An Independent Contractor will be paid for the job, not the hours worked. Essentially independent contractors are running their own business. Typically they have own business cards, their own website, and will be advertising and marketing their own services to other companies.
It is best to run your own analysis and discover what type fits best for the position you are looking to fill.
01/13/2020
By: Gary Grottke CPA, Quality Back Office LLC
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