Question

The factors that determine the degree of control or independence from the IRS website are as follows:

Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?
Financial: Are the business aspects of the worker’s job controlled by the payer? (these include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
Type of Relationship: Are there written contracts or employee type benefits (i.e. pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business?

Answer 1

The degree of control or independence is determined by behavioral control, financial control, and the type of relationship between a worker and a company. These factors are used by the IRS to understand if an individual is an employee or an independent contractor. The broader context includes the government's role in regulations that can impact this dynamic.

Step-by-step explanation:

The degree of control or independence of a worker as per the IRS standards is influenced by various factors. Firstly, behavioral control refers to the company's right to dictate what a worker does and how tasks are completed. Secondly, financial control entails aspects such as methods of payment, expense reimbursement, and provision of tools and supplies. Lastly, the type of relationship, including the presence of contracts, employee benefits, longevity of the relationship, and centrality of work to the business's operations, helps to define the nature of the employment arrangement. These distinctions are essential for determining whether an individual is an employee or an independent contractor.

From a broader perspective, governmental influence on private companies via taxes, regulations on wages, and guidelines for worker and environmental safety showcase control mechanisms outside of a company. This blurs the line between a purely capitalist country and one with certain socialist characteristics. Moreover, debates around the extent of government involvement in the economy, fair treatment of workers, and economic freedom underscore the balance required between worker rights and business operations.