Independent Contractor

Independent Contractor

Independent Contractor

Determining Worker Status: Employee or Independent Contractor?

When hiring workers, it is important for tax purposes to correctly categorize the position as an employee or an independent contractor. Classification of workers is determined by three main factors including: behavioral, relationship of parties, and financial controls, which are detailed below.

Employee Factors

Behavioral controls: If Rowan directs or controls the work to be done, how to do the work, what to do, when to do the work, or have the right to direct or control the work. For example, control is when an employer sets the work schedule, the hours, trains the person, and sets the location and the tasks to be done.

Relationship of parties: The employee does not have other clients; does not hold himself out to the public, or advertise, etc.; can be fired or terminated; or there is a continuing relationship and no limited time frame.

Financial controls: Determining factors include if the worker is reimbursed for business expenses; cannot earn a profit or loss on the business; is the paid by the hour or by the week; works only for Rowan or an affiliate.

Independent Contractor Factors

Some factors which indicate the potential for being classified as an independent contractor

  • Worker sets own schedule, work location, tasks, and how to do perform tasks
  • Can also work for others during contract
  • Paid by project
  • Cannot be fired, except for non-delivery of contract
  • No continuing relationship is anticipated
  • Has other clients or hold self out for other business
  • Has significant investment in the business,rents space, has employees
  • Pays for own expenses

These factors alone are not determinant of an independent contractor status.

If you have any questions please contact us at independentcontractor@rowan.edu 

 

Independent Contractor Policy Information Sessions

Additional sessions will be held in late January 2018 (TBD).

 

Policy

Predetermination

Upon Determination

A. Employee

B. Independent Contractor