Page 224 - Washington Nonprofit Handbook 2018 Edition

• Method of Payment. Payment by payroll check, payment on a salary
basis, or payment for hourly work would tend to support a conclusion
that the worker is an employee.

• Whether the Work Is Part of the Regular Business of the Hiring
Party. If the work performed is part of the hiring party’s regular
business, the worker is more likely to be considered an employee.

• The Extent of the Worker’s Discretion Over When and How Long
to Work. The less discretion the worker has over when, how, and for
how long, the more likely it is that the worker will be considered an
employee.

• Whether the Hired Party Is in Business. A worker hired as an
independent contractor who does not have any indicia of being in
business (does not have a business license, tax ID number, etc.) is
more likely to be considered an employee.

• Whether the Worker Receives Employee Benefits. If a worker
receives benefits usually given to employees, the worker is more likely
to be considered an employee.

• How the Parties Treat the Worker for Tax Purposes. How the
parties themselves characterize their relationship is relevant, but not a
controlling factor. If the facts otherwise indicate that the worker is an
employee, an agreement between the parties to the contrary is not
sufficient to alter the employee’s status.

The “right of control” test requires all of these factors to be considered and
weighed. No one factor is decisive and there is no shorthand formula or magic
phrase that can be applied to find the answer. After considering all of these factors,
if a person is not found to be an employee, he or she will be considered an
independent contractor.

(ii) “Economic Realities” Test

For purposes of the Washington Minimum Wage Act (the “WMWA”) and Fair
Labor Standards Act (the “FLSA”) the proper test for determining whether a worker
is an employee or independent contractor is the “economic dependence” test
rather than the right of control test described above. The economic dependence
test asks “whether, as a matter of economic reality, the worker is economically

WASHINGTON NONPROFIT HANDBOOK -213- 2018