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Employment: Am I an employee or 1099?

Employment: Am I an employee or 1099?

Attorney, Bradley Hunt

The landscape of traditional employment is changing. Whether you’re a traditional employee or a contract one, you should know what type of employment agreement you are signing or adhering to. Understanding the difference between an employee and an independent contractor is important.

Traditional vs. Contract

According to the Internal Revenue Service  (IRS), there are three categories that must be examined to determine if a person is an employee or an independent contractor. These three categories include:

  • Behavioral Control – covers facts that show if the business has a right to direct and control what work is accomplished and how the work is done, through instructions, training, or other means.
  • Financial Control – covers facts that show if the business has a right to direct or control the financial and business aspects of the worker’s job.
  • Relationship of the Parties – covers facts that show the type of relationship the parties had.

Unlike behavioral control, relationship of the parties may include details related to but not limited to written contracts, employee benefits, and permanency of the relationship.

Independent Contractor

While there are many differences between being a traditional employee and a contract worker, there is one main element that applies to contract employees. For a contract worker, the IRS states that “An individual is an independent contractor or 1099 employee if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.”

As a contract worker knowing what state or federal laws, rules, or guidelines are applicable to your line of work is essential in protecting your rights. This will save you time and trouble if legal issues arise during or after your contract has ended.

Protect Yourself

As an employee whether traditional or contract, you must determine what type of employment classification makes sense for the level of work that you offer.

Before entering into an employment agreement or contract there should always be clear directives on what type of employee you will be.

Contact Brinkley Walser Stoner today to schedule an appointment with one of our experienced attorneys.

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