Employer-Employee Relationship
Employer-Employee Relationship Paper
The United States government has guidelines that dictate how companies interact with its employees to make sure all parties are equally covered in regards to employment rights. When Mary is let go from her job as a programmer from the Little Lamb Company and then subsequently not rehired when a job opening becomes available some questions arise. In this paper the questions of Mary’s status as an independent contractor or an employee, the employer/employee relationship changes over the course of time, and the release legal under the doctrine of employment-at-will will be addressed and answered.
INDEPENDENT CONTRACTOR/EMPLOYEE
The status of Mary being an independent contractor versus employee can always be a tricky point due to the nature of the type of work that is being done. According to the Employer’s Supplemental Tax Guide provided by the IRS, “An employer must generally withhold federal income taxes, withhold and pay social security and Medicare taxes, and pay unemployment tax on wages paid to an employee. An employer does not generally have to with- hold or pay any taxes on payments to independent contractors (Department of the Treasury, 2008).” The textbook Employment Law for Business states independent contractors as, “A person who contracts with a principal to perform a task according to her or his own methods, and who is not under the principal’s control regarding the physical details of the work (Bennett-Alexander and Hartman, 2007).” While both of these definitions sound all well and good it can be very hard to determine if in fact a person on in this case Mary is an employee thusly the IRS came up with a series of questions that separates the two. The IRS 20 factor test is uses the term control be it, “behavioral control, financial control, and the type of relationship of the parties” to determine the work status (Department of the Treasury, 2008). One of the key elements of the test is the use of
The United States government has guidelines that dictate how companies interact with its employees to make sure all parties are equally covered in regards to employment rights. When Mary is let go from her job as a programmer from the Little Lamb Company and then subsequently not rehired when a job opening becomes available some questions arise. In this paper the questions of Mary’s status as an independent contractor or an employee, the employer/employee relationship changes over the course of time, and the release legal under the doctrine of employment-at-will will be addressed and answered.
INDEPENDENT CONTRACTOR/EMPLOYEE
The status of Mary being an independent contractor versus employee can always be a tricky point due to the nature of the type of work that is being done. According to the Employer’s Supplemental Tax Guide provided by the IRS, “An employer must generally withhold federal income taxes, withhold and pay social security and Medicare taxes, and pay unemployment tax on wages paid to an employee. An employer does not generally have to with- hold or pay any taxes on payments to independent contractors (Department of the Treasury, 2008).” The textbook Employment Law for Business states independent contractors as, “A person who contracts with a principal to perform a task according to her or his own methods, and who is not under the principal’s control regarding the physical details of the work (Bennett-Alexander and Hartman, 2007).” While both of these definitions sound all well and good it can be very hard to determine if in fact a person on in this case Mary is an employee thusly the IRS came up with a series of questions that separates the two. The IRS 20 factor test is uses the term control be it, “behavioral control, financial control, and the type of relationship of the parties” to determine the work status (Department of the Treasury, 2008). One of the key elements of the test is the use of
References: Internal Revenue Service, (2008), retrieved September 5th, 2008 from www.irs.gov/ Bennett-Alexander D., and Hartman L., (2007), Employment Law for Business 5th ed. McGraw-Hill. Boston, MA [University of Phoenix Custom Edition e-text]. Retrieved September 1st 2008, from University of Phoenix, MGT 434 Web site. Illinois State University, (2008), comptroller, retrieved September 5th , 2008 from www.comptroller.ilstu.edu/