How many employees does your company have? The question is not always as straightforward as it seems. In addition to the difficulties caused by turnover and counting part-time employees, we have a new complication. Gig workers are generally considered contractors, but this classification is being challenged. If these challenges succeed, many companies may have far more employees than they realize. This would have a significant impact on insurance.
Independent Contractors vs Employees
The line separating independent contractors from employees can get blurry. According to the IRS, “The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work, not what will be done and how it will be done.” To determine whether a worker is an employee, it’s necessary to look at three areas: behavioral control, financial control and the relationship.