Pit & Quarry, September 2016

LAboR Although those who work gigs appear to be a new class of free agent in reality they have autonomy yet not complete control Uber sets the fares for each service in each city based on its own formula which is calculated using either per mile or per minute rates on top of a base fare Genuine independent contractors determine and negotiate their own rates with clients They possess refined and in demand skills They often bring a rare expertise that clients cant find in the typical labor pool In other words they operate as micro business entities START UP bASIcS For the most part independent contractors are individuals who are hired to do a particular job receiving payment only for the work being performed Independent contractors are business owners and are not their customers employees They do not receive employee benefits or the same legal protections as employees and are usually responsible for their own expenses As an independent contractor a worker is responsible for paying his or her own taxes Social Security unemployment taxes workers compensation health insurance and other benefits The aggregate producer will not withhold taxes As a business owner an independent contractor will need to pay estimated taxes throughout the year instead of once a year on April 15 Becoming a true independent contractor means becoming a small separate business entity The nature of the working relationship between independent contractors and clients or customers is not without risk By taking every precaution to establish a self governing operation an independent contractor can mitigate exposure to these risks both for themselves and for the clients and customers of their independent business PRoof PoSITIve No less a body than the U S Supreme Court has said that there is no definition that solves all problems relating to the employer employee relationship under the Fair Labor Standards Act FLSA The court has also said that determination of the relationship cannot be based on isolated factors or upon a single characteristic but depends upon the circumstances of the whole activity In general an employee as distinguished from an independent contractor who is engaged in a business of his or her own is one who follows the usual path of an employee and is dependent on the business that they serve The IRS formerly used what was known as the Twenty Factor test Today the IRS has attempted to simplify and refine the test consolidating the 20 factors into 11 main tests and organizing them into three main groups Behavioral Does the client or customer have the right to control what the worker does and how the worker does his or her job Financial Are the business aspects of the workers job controlled by the payer This includes such things as how payment is made whether expenses are reimbursed and who provides tools supplies Type of Relationship Are there written contracts or employee type benefits such as a pension plan insurance vacation pay etc Will the relationship continue and is the work performed a key aspect of the client or customer Obviously there is no magic or set number of factors that makes a worker an independent contractor or someone an employee The key is to look at the entire relationship consider the degree or extent of the right to direct and control and finally to document each of the factors used to produce the proper label of worker or independent contractor If there is any doubt remaining after reviewing the three categories of evidence Form SS 8 Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding can be filed with the IRS by either the aggregate producer or the independent contractor Unfortunately review of the facts and circumstances can take at least six months for the IRS to reach a determination Cemex takes delivery of new REICHdrill C 450 at Clinchfi eld Plant in Georgia 99 Troy Hawk Run Highway Philipsburg PA 16866 Ph 814 342 5500 Fax 814 342 1135 www reichdrill com 96 PIT QUARRY September 2016 pitandquarry com