The MICL has other important provisions. A written contract or description indicating that a worker is exempt from instructions or regulatory controls is necessary to justify independent title (at least according to the Attorney General). An employer`s inability to maintain taxes, contribute to unemployment compensation or compensate workers cannot be taken into account in determining the status of the worker, indicating that an employer`s subjective belief that a worker is an independent contractor is irrelevant under the law. The law also creates broad responsibility for both companies and individuals, including senior managers and those responsible for management`s responsibility to the workers involved. Somers v. Converged Access, Inc., 454 Mass. 582 (2009) The amount of the injury is not measured “by deduction of the compensation that the applicant, as an independent contractor, would have received from the compensation that the applicant would have received had he been hired as an employee. We conclude that this compensation measure is contrary to both the obvious importance and the main purpose of the status of independent contractors and the Wage Act. A worker who has been misclassified as a self-employed contractor is a worker; its contract rate is its rate of pay; and his “damages” are the value of the wages and benefits he should have received as a worker, but not. The Common Law Test and its 20 factors may be the best-known test for determining worker status. In the context of the Fair Labor Standards Act (“FLSA”), which includes federal minimum wage and overtime requirements, the U.S. Department of Labor (“DOL”) considers the “economic reality” of the relationship to be significant: (1) the extent to which the services provided are an integral part of the employer`s activity; (2) the permanence of the relationship; (3) the level of worker investment in facilities and equipment; (4) the nature and degree of control of the employer; (5) the worker`s chances of profit and loss; 6) the extent of the initiative, judgment or foresight in open competition with others necessary for the success of the independent contractor claimed; and (7) the degree of organization and activity of an independent company.

Many people are also negatively affected. People who choose to work as independent contractors are faced with the loss of customers who are now afraid to use it. Others are facing a drop in demand for their work and/or the amount paid for their services, as companies are now required to pay FICA, FUTA, unemployment insurance and workers` compensation premiums. Some believe that companies will end their relationships with individual contractors and instead turn to professional staffing companies. The IRS is the government agency responsible for determining whether a worker is an independent worker or contractor for federal labour taxes. While the term “worker” is somewhat different for FICA, FUTA and federal sources of income, the main test used by the IRS to determine worker status is called the Common Law Test. This test examines the extent to which the company retains the right to direct and control the worker in terms of when, where and how.