Question

Parkers Appliances wants to improve the quality of and lower the costs in its service department. A strategy being considered involves directing technicians on exactly how to complete service calls, which should improve customer service in addition to lowering labor costs. In addition, the technicians will work under a contract so the company doesn't have to pay the employer's share of Social Security for those workers. Is this a possible strategy for Parkers Appliances to employ?

Answer 1

No its not, because the workers should be considered employees and not independent contractors.

Step-by-step explanation:

The IRS performs the following analysis to determine if a worker is an employee or an independent contractor, it is divided into three main categories:

1. Behavioral: is your work controlled by the company? YES, PARKER APPLIANCES CONTROLS THE WORK DONE.
2. Financial: does the company control how you are paid, any applicable reimbursements and/or provides working tools and supplies? YES, PARKER APPLIANCES PAYS THE WORKERS DIRECTLY AND PROVIDES THEM WITH ALL THE NECESSARY TOOLS AND SUPPLIES.
3. Type of Relationship: do you have a written contract with the company, and does the working relationship continue or is it only for a fixed period? EVEN THOUGH THERE IS A WRITTEN CONTRACT THAT STATES THAT THE WORKERS ARE INDEPENDENT CONTRACTORS, THEIR WORKING RELATIONSHIP IS PERMANENT.