Employment Relationship Flashcards
Tests to Determine Who Is an Employee
3
(1) Right to Control Test
(2) Economic Realities Test
(3) ABC Test
Right to Control Test
Individual is an EE when:
(1) Individual RENDERS SERVICES TO SERVE ER’S INTERESTS;
(2) ER CONSENTS to receive those services; and
(3) ER CONTROLS MANNER AND MEANS by which the individual renders services
Factors Considered Under Right to Control Test
(1) AGREEMENT on control
(2) Whether AGENT ENGAGED IN DISTINCT OCCUPATION or business
(3) Whether PRINCIPAL ENGAGED IN A BUSINESS
(4) Whether work being done is IN THE USUAL COURSE OF THE PRINCIPAL’S BUSINESS
(5) SKILL required
(6) Whether AGENT SUPPLIES OWN TOOLS AND PLACE OF WORK
(7) METHOD OF PAY (hourly or by job)
(8) Whether PARTIES BELIEVE THEY ARE CREATING AN EMPLOYMENT RELATIONSHIP
Cases Right to Control Test Applies To
TORT ACTIONS
NLRA, ERISA, IRC, OSHA, Title VII CRA, ADA, ADEA, Indiana Workers’ Compensation
Economic Realities Test
Under the economic realities of the situation, is the agent ECONOMICALLY DEPENDENT on the principal
Factors Considered Under Economic Realities Test
(1) Extent of the employer’s CONTROL AND SUPERVISION
(2) SKILLS REQUIRED to perform the work
(3) RESPONSIBILITIES FOR COSTS such as equipment, supplies, and licenses
(4) METHOD OF PAYMENT
(5) LENGTH of job commitment
(6) EXPECTATIONS for completing job
Cases Economic Realities Test Applies To
FLSA
FLMA
ABC Test
PRESUMED TO BE EE unless ER shows:
(1) Agent FREE FROM CONTROL;
(2) Service performed OUTSIDE USUAL COURSE OF BUSINESS FOR PRINCIPAL; and
(3) Agent is customarily engaged in an independent established trade, occupation, profession, or business SIMILAR TO THE SERVICE PERFORMED
Cases ABC Test Applies To
Indiana unemployment compensation
Constraints on ER’s Ability to Terminate At-Will EE
(1) An employment agreement for a SPECIFIC PERIOD;
(2) An employer’s enforceable POLICY STATEMENT;
(3) ADEQUATE INDEPENDENT CONSIDERATION for a promise of permanent employment;
(4) PUBLIC POLICY; and
(5) PROMISSORY ESTOPPEL
At-Will EE
EE or ER is free at any time, without notice or cause, to terminate the relationship
For-Cause EE
Can only be discharged for cause
