Pete explained the difference between an independent contractor and an employee, which can be summarized as a matter of control.  There are three areas of control:

  • Behavioral control
    • Who controls the what is done, how it is done, what tools are used, etc.?
  • Financial control
    • Are expenses reimbursed?
    • Does the individual share in the profit and loss?
    • Does the individual have the right to market services independently?
  • Relationship control
    • Is there a contract?
    • Is insurance or any other benefits included

All of these are critical, since operating incorrectly can lead to significant financial issues.  If you have any questions, be sure to contact Pete for further information.

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