Nurse as Independent Contractor or Employee

	Are You Correctly Classifying Your Workers?
	" As a consultant to many new healthcare staffing agency startups, I have been asked again and again about the issue of independent contractors. With the possible introduction of new legislation aimed at ending the abuse of employee misclassification, the answer to the question of employee classification has become more important than ever, and those who attempt to "work" the system by purposefully misclassifying their employees could suffer serious consequences."
	For those considering an expansion or startup into healthcare staffing, there could not be a more fundamental question than that of worker classification. Just because it has become commonplace to see agency nurses classified as "independent contractors" does not make it "right" and if you have thought about classifying your workers as "independent contractors" you may want to think again. Although the original Employee Misclassification Act bill that was introduced in 2008 never actually became law, many believe that President Obama is likely to resurrect the legislation that he had helped to introduce in 2008 that will aim to end the purposeful misclassification of employees. According to a 2008 press release sent out by the U.S. House of Representatives Committee on Education and Labor, employees who have been misclassified by their employers have been deprived of "important rights, such as workers' compensation coverage, minimum wage and overtime protections, family and medical leave, and the right to organize and collectively bargain." "The egregious practice of misclassifying workers as independent contractors needs to end," said Rep. Rob Andrews (D-NJ), chairman of the Subcommittee on Health, Employment, Labor and Pensions. "The bill will protect employee benefits, remove incentives for employers to misclassify their workers, and ensure that bad employers don't line their own pockets with unpaid payroll taxes." So how can you determine the correct status of your workers? The www.IRS.gov website provides some simple guidelines to help employers determine accurate worker classification. Important determining factors fall into three major categories: Behavioral: Does the company control or 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 worker's job controlled by the payer? (these include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.) Type of Relationship: Are there written contracts or employee type benefits (i.e. pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business? Businesses must weigh all these factors when determining whether a worker is an employee or independent contractor. Some factors may indicate that the worker is an employee, while other factors indicate that the worker is an independent contractor. There is no "magic" or set number of factors that "makes" the worker an employee or an independent contractor, and no one factor stands alone in making this determination. Also, factors which are relevant in one situation may not be relevant in another. The keys are 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 in coming up with the determination. If you're still not sure, you can ask the government to assist you in the determination by completing Form SS-8 . With that being said, it might just be easier to accept the fact that as an employer, we have a certain responsibility to protect the folks that allow us to earn a living and also to pay our taxes in accordance with the law. There will always be those who will do whatever they can to "cheat the system", but if this legislation is actually enacted, it may soon become very costly to do so.