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If you're paid commission off the total amount of billed work you do (in this case, a towing business) are you considered an employee of that company?

Answers

Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |

Anon
What service are you providing?
-towing cars-with your tow truck-exclusively for this company
-selling the tow company services
-admin work OR
something else?

There is an IRS checklist that helps you decide employee v contractor status
I think you should be able to search for it here

Anonymous
(Owner manager) |

Sorry didn't see reply button... My reply is below... Thanks

Anonymous
(Owner manager) |

Doing deliveries pickup & drop off of storage containers mostly...using their equipment but they pay him off commission 30% of all invoices he turns in....they dispatch the work & he completes the jobs & turns in a log & invoices of work every two weeks & they base his pay 30% of total amount he turns in

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Is he "leasing/renting" the equipment used?

This scheme is used by many taxi services, but to be on the safe side I'd pay minimum wage and adjust the commission.

Topic Expert
Regis Quirin
Title: Director of Finance
Company: Gibney Anthony & Flaherty LLP
LinkedIn Profile
(Director of Finance, Gibney Anthony & Flaherty LLP) |

Your question is extremely timely. This situation is evolving daily. But no one can definitively tell you unless they know all the specifics, as there are a host of determining factors. The greatest factor is control. Does the business have any say over the way the individual performs the work, other than abiding by the laws specific to your industry? The next factor would be equipment used, i.e. the company's equipment or the individual's equipment? The third factor would be dependence. Is the economic livelihood of the individual dependent on the company or does he/she have other clients they make deliveries for? There are a few other questions, but those are the top three.

Mis-classification is a big problem that the government does not look kindly on, at the current time.

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