De Facto Employee
tfevergrn
114 Posts
In the state of Calfornia, how many hours does a temporary employee have to work before they become a "de facto" employee?
Thanks in advance for any help you can provide!
Tina Marie
Thanks in advance for any help you can provide!
Tina Marie
Comments
>temporary employee have to work before they
>become a "de facto" employee?
>
>Thanks in advance for any help you can provide!
>
>Tina Marie
Found my answer.......
Worker Status Test:
12 Common Law Factors Test Under ERISA
ERISA is administered by the U.S. Department of Labor. It's general rule regarding permissible exclusions (who may be excluded from participation in a company's employee benefit plan because of various legal criteria) is that an employer may exclude any employee who works less than 1000 hours in a relevant twelve-month period. As a result, "temporary" employees who work forty hours per week for less than a full six-months within a particular twelve-month period are mathematically eliminated. This is not, however, an automatic exclusion. A company's employee benefits plan must have the correct language implementing the intended exclusion or risk having to provide the benefits to temporary and/or part-time employees as well as independent contractors whom a court determines to be common law employees.
While ERISA does not provide a statutory list of factors for courts to consider when determining whether a worker is an independent contractor or common law employee for purposes of employee benefits under ERISA, the U.S. Supreme Court did so in the landmark case of Darden v. U.S, when it outlined 12 significant factors which it considers most significant in determining a worker's status as an employee or independent contractor under ERISA.
Following are the 12 significant factors as listed by the Supreme Court (the full text of the Darden case is included in the Contingent Employment Law Manual Supplement)
1. skill required;
2. source of tools and instrumentalities;
3. location where work performed;
4. duration of relationship of parties;
5, hiring party's right (or lack thereof) to assign additional projects; 0
6. hired party's discretion over when and how long to work;
7. method of payment;
8. hired party's role in hiring and paying assistants;
9. whether the work is part of hiring party's regular business;
10. whether the hired party is in business;
11. whether "employee benefits" are provided; and
12. the tax treatment of the hired party.
There is nothing wrong with hiring temporary workers or independent contractors. Legal risks arise when an employer mislabels or "misclassifies" a true employer-employee relationship. employer-employee relationship.Under ERISA, misclassification can lead to very costly tax and benefit liabilities. This makes understanding the factors necessary to the creation of a true independent contractor relationship vs.a true employer-employee relationship all the more important.