You Decide Template

Submitted By saphr
Words: 734
Pages: 3

You Decide Template
Name ____________ Date___July 13, 2013___

Scenario Summary:

Your Role/Assignment:

Your role is to decide if Karen is an independent contractor or an employee and discuss some of the preventative and ethical situations that are occurring in this case.

Questions:

1. Do you feel that Karen is an independent contractor or an employee? What is your rationale for this decision?
I think Karen is an independent Contractor (IC), Karen started working with ABC utility to develop training materials for an upcoming session on diversity but Cynthia was very pleased with her work and ask Karen to work on some additional projects for the company. Karen was hired at ABC utility as a Human resource temporary, but since she has been there for the last 5 years and does so much work with ABC utility she has been retained and her position is now Human Resource Consultant. Karen was probably thinking she was an employee there because they retained her and changed her position from Human Resource temporary to Human Resource Consultant.

2. What factors do you feel help contribute to Karen being an employee?

In the summary it states that Karen started working for the company as a Human Resource temporary but her new title evolved into Human Resources Consultant to be more consistent with others in the department who are doing work similar to hers. It shows that the company thinks of Karen as an employee for the simple fact they change her title to be more consistent with others in the department, in doing so it’s showing that Karen is being treated more like an employee rather than a independent contractor. As the IRS list 20 factors to help determine if someone is an employee or not and Karen and the ABC utilities in this case shows a continuing relationship which is one of the factors.

3. What factors favor her being a contractor?

I think one factor that contributes to Karen being a independent contractor is she is in the summary it states that Karen had other clients for an approximately 40 hours project over the years and she has clients that keep her on a retainer basis. This one statement shows Karen has being an independent contractor because when you have clients keeping you on retainers meaning they will call you when they need you and you are an ongoing part of their company that shows independent contractual work. Also the IRS sent Karen a 1099 form, which is given to independent contractors from employers to show what is been paid to them.

4. What are some potential legal implications in the case? What should the utility do to rectify any wrongs in this situation?

The Potential legal implications in this case are related to government taxes Karen gets paid 10,000 a month what is taken out by the government? Like Federal taxes,