Many employers would use independent contractors to perform their work if they could. The use of independent contractors relieves the employer of many time-consuming and costly burdens; however, the determination of whether a worker is truly an independent contractor or an employee is not easily made.
California State Labor Code 3357 provides: “Any person rendering service for another, other than as an independent contractor, or expressly excluded herein, is presumed to be an employee.” The statue does not explain the difference between an independent contractor and an employee; however, the courts have placed the burden of proving "non-employee” status on the “employer.”
A crucial factor in determining employment status is the right to direct and control the work being performed. If the employer has that right, whether or not it is exercised, the courts have routinely decided that the “independent contractor” is actually an employee.
The tests for determining whether a worker should be classified as an employee or an independent contractor are based on "common law" rules that rely on custom and usage rather than written codes. Generally, workers are considered employees when they:
Must comply with the employer's work instructions.
Receive training from, or at the direction of, the employer.
Provide services that are integral to the employer's business.
Provide services that must be rendered personally.
Hire, supervise and pay workers for the employer.
Have an ongoing working relationship with the employer.
Must follow set hours of work.
Work full-time for the employer.
Do their work on the employer's premises.
Must do their work in a sequence set by the employer.
Must submit regular reports to the employer.
Receive payments of regular amounts at set intervals.
Receive payments for business and/or travel expenses.
Rely on the employer to provide tools and materials.
Lack a major investment in resources for providing services.
Cannot make a profit or suffer a loss from their services.
Work for one employer at a time.
Do not offer their services to the general public.
Can be fired by the employer.
May quit work at any time without incurring liability.