IC 22-2-15
Chapter 15. Guidelines and Procedures for Investigating
Questions and Complaints Concerning Employee Classification
IC 22-2-15-1 "Department"
Sec. 1. As used in this chapter, "department" refers to the
department of labor created by IC 22-1-1-1. As added by P.L.110-2010, SEC.22.
IC 22-2-15-2 Development of guidelines and procedures concerning employee
classification; contents; exemptions; plan for implementation
Sec. 2. (a) The department shall develop guidelines and
procedures for investigating questions and complaints concerning
employee classification and a plan for implementation of those
guidelines and procedures.
(b) The guidelines and procedures must do the following:
(1) Cover at least the following:
(A) Who is eligible to file a complaint. The guidelines and
procedures must allow any aggrieved person to file a
complaint and must indicate what evidence is needed to
initiate an investigation.
(B) Applicable and appropriate penalties, taking into
consideration:
(i) the financial impact on both employers and
misclassified employees; and
(ii) whether the employer has previously misclassified
employees.
(C) Mechanisms to share data with appropriate state
agencies to assist those agencies in determining compliance
with and enforcing state laws concerning misclassified
employees and to recoup contributions owed, depending on
the level of culpability.
(D) Record keeping requirements for contractors, including
any records necessary for the department to investigate
alleged violations concerning misclassification of
employees.
(E) Investigative procedures.
(2) Apply to public works and private work projects for the
construction industry (as described in IC 4-13.5-1-1(3)),
including demolition.
(3) Apply to any contractor that engages in construction and is
authorized to do business in Indiana.
(4) Provide a remedy for an employer or a misclassified
employee in response to:
(A) any retaliation that occurs as the result of an
investigation or a complaint; and
(B) any complaints that the department determines are
frivolous or that are filed for the purpose of harassment.
(5) Provide that in carrying out this chapter the department has
the same inspection, investigative, and enforcement powers that
the department has in enforcing the labor laws of this state,
including powers described in IC 22-1-1.
(c) The guidelines and procedures may include other elements as
determined by the department.
(d) The department shall exempt the following from the
guidelines and procedures developed under this chapter:
(1) Residential construction of a single family home or duplex
if the builder builds less than twenty-five (25) units each year.
(2) An owner-operator that provides a motor vehicle and the
services of a driver under a written contract that is subject to
IC 8-2.1-24-23, 45 IAC 16-1-13, or 49 CFR 376, to a motor
carrier. As added by P.L.110-2010, SEC.22.
IC 22-2-15-3 Use of Internal Revenue Code definitions; use of Internal Revenue
Service factors
Sec. 3. In developing the guidelines and procedures under this
chapter, the department shall use:
(1) the definition of "employee" used in Section 3401(c) of the
Internal Revenue Code; and
(2) the following factors used by the Internal Revenue Service
to determine whether a worker is an independent contractor:
(A) Instructions. A worker who is required to comply with
other persons' instructions about when, where, and how he
or she is to work is ordinarily an employee. This control
factor is present if the person or persons for whom the
services are performed have the right to require compliance
with instructions. See, for example, Rev. Rul. 68-598,
1968-2 C.B. 464, and Rev. Rul. 66-381, 1966-2 C.B. 449.
(B) Training. Training a worker by requiring an experienced
employee to work with the worker, by corresponding with
the worker, by requiring the worker to attend meetings, or by
using other methods, indicates that the person or persons for
whom the services are performed want the services
performed in a particular method or manner. See Rev. Rul.
70-630, 1970-2 C.B. 229.
(C) Integration. Integration of the worker's services into the
business operations generally shows that the worker is
subject to direction and control. When the success or
continuation of a business depends to an appreciable degree
upon the performance of certain services, the workers who
perform those services must necessarily be subject to a
certain amount of control by the owner of the business. See
United States v. Silk, 331 U.S. 704 (1947), 1947-2 C.B. 167.
(D) Services rendered personally. If the services must be
rendered personally, presumably the person or persons for
whom the services are performed are interested in the
methods used to accomplish the work as well as in the
results. See Rev. Rul. 55-695, 1955-2 C.B. 410.
(E) Hiring, supervising, and paying assistants. If the person
or persons for whom the services are performed hire,
supervise, and pay assistants, that factor generally shows
control over the workers on the job. However, if one (1)
worker hires, supervises, and pays the other assistants under
a contract under which the worker agrees to provide
materials and labor and under which the worker is
responsible only for the attainment of a result, this factor
indicates an independent contractor status. Compare Rev.
Rul. 63-115, 1963-1 C.B. 178, with Rev. Rul. 55-593 1955-2
C.B. 610.
(F) Continuing relationship. A continuing relationship
between the worker and the person or persons for whom the
services are performed indicates that an employer-employee
relationship exists. A continuing relationship may exist
where work is performed at frequently recurring although
irregular intervals. See United States v. Silk.
(G) Set hours of work. The establishment of set hours of
work by the person or persons for whom the services are
performed is a factor indicating control. See Rev. Rul.
73-591, 1973-2 C.B. 337.
(H) Full time required. If the worker must devote
substantially full time to the business of the person or
persons for whom the services are performed, such person or
persons have control over the amount of time the worker
spends working and impliedly restrict the worker from doing
other gainful work. An independent contractor on the other
hand, is free to work when and for whom he or she chooses.
See Rev. Rul. 56-694, 1956-2 C.B. 694.
(I) Doing work on employer's premises. If the work is
performed on the premises of the person or persons for
whom the services are performed, that factor suggests
control over the worker, especially if the work could be done
elsewhere. Rev. Rul. 56-660, 1956-2 C.B. 693. Work done
off the premises of the person or persons receiving the
services, such as at the office of the worker, indicates some
freedom from control. However, this fact by itself does not
mean that the worker is not an employee. The importance of
this factor depends on the nature of the service involved and
the extent to which an employer generally would require that
employees perform such services on the employer's
premises. Control over the place of work is indicated when
the person or persons for whom the services are performed
have the right to compel the worker to travel a designated
route, to canvass a territory within a certain time, or to work
at specific places as required. See Rev. Rul. 56-694.
(J) Order of sequence set. If a worker must perform services
in the order or sequence set by the person or persons for
whom the services are performed, that factor shows that the
worker is not free to follow the worker's own pattern of work
but must follow the established routines and schedules of the
person or persons for whom the services are performed.
Often, because of the nature of an occupation, the person or
persons for whom the services are performed do not set the
order of the services or set the order infrequently. It is
sufficient to show control, however, if such person or
persons retain the right to do so. See Rev. Rul. 56-694.
(K) Oral or written reports. A requirement that the worker
submit regular or written reports to the person or persons for
whom the services are performed indicates a degree of
control. See Rev. Rul. 70-309, 1970-1 C.B. 199, and Rev.
Rul. 68-248, 1968-1 C.B. 431.
(L) Payment by hour, week, month. Payment by the hour,
week, or month generally points to an employer-employee
relationship, if this method of payment is not just a
convenient way of paying a lump sum agreed upon as the
cost of a job. Payment made by the job or on a straight
commission generally indicates that the worker is an
independent contractor. See Rev. Rul. 74-389, 1974-2 C.B.
330.
(M) Payment of business and traveling expenses. If the
person or persons for whom the services are performed
ordinarily pay the worker's business or traveling expenses or
business and traveling expenses, the worker is ordinarily an
employee. An employer, to be able to control expenses,
generally retains the right to regulate and direct the worker's
business activities. See Rev. Rul. 55-144, 1955-1 C.B. 483.
(N) Furnishing of tools and materials. The fact that the
person or persons for whom the services are performed
furnish significant tools, materials, and other equipment
tends to show the existence of an employer-employee
relationship. See Rev. Rul. 71-524, 1971-2 C.B. 346.
(O) Significant investment. If the worker invests in facilities
that are used by the worker in performing services and are
not typically maintained by employees (such as the
maintenance of an office rented at fair value from an
unrelated party), that factor tends to indicate that the worker
is an independent contractor. On the other hand, lack of
investment in facilities indicates dependence on the person
or persons for whom the services are performed for such
facilities and, accordingly, the existence of an
employer-employee relationship. See Rev. Rul. 71-524.
Special scrutiny is required with respect to certain types of
facilities, such as home offices.
(P) Realization of profit or loss. A worker who can realize a
profit or suffer a loss as a result of the worker's services (in
addition to the profit or loss ordinarily realized by
employees) is generally an independent contractor, but the
worker who cannot is an employee. See Rev. Rul. 70-309.
For example, if the worker is subject to a real risk of
economic loss due to significant investments or a bona fide
liability for expenses, such as salary payments to unrelated
employees, that factor indicates that the worker is an
independent contractor. The risk that a worker will not
receive payment for his or her services, however, is common
to both independent contractors and employees and thus
does not constitute a sufficient economic risk to support
treatment as an independent contractor.
(Q) Working for more than one (1) firm at a time. If a
worker performs more than de minimis services for a
multiple of unrelated persons or firms at the same time, that
factor generally indicates that the worker is an independent
contractor. See Rev. Rul. 70-572, 1970-2 C.B. 221.
However, a worker who performs services for more than one
(1) person may be an employee of each of the persons,
especially where such persons are part of the same service
arrangement.
(R) Making service available to general public. The fact that
a worker makes his or her services available to the general
public on a regular and consistent basis indicates an
independent contractor relationship. See Rev. Rul. 56-660.
(S) Right to discharge. The right to discharge a worker is a
factor indicating that the worker is an employee and the
person possessing the right is an employer. An employer
exercises control through the threat of dismissal, which
causes the worker to obey the employer's instructions. An
independent contractor, on the other hand, cannot be fired so
long as the independent contractor produces a result that
meets the contract specifications. Rev. Rul. 75-41, 1975-1
C.B. 323.
(T) Right to terminate. If the worker has the right to end his
or her relationship with the person for whom the services are
performed at any time he or she wishes without incurring
liability, that factor indicates an employer-employee
relationship. See Rev. Rul. 70-309.
(U) Any other guidelines under IC 22-3-6-1(b) and
IC 22-3-7-9(b)(5). As added by P.L.110-2010, SEC.22.
IC 22-2-15-4 Presentation to pension management oversight commission
Sec. 4. The department shall make a presentation to the pension
management oversight commission not later than October 1, 2010,
outlining the proposed guidelines and procedures. As added by P.L.110-2010, SEC.22.
IC 22-2-15-5 Recommendations to legislative council
Sec. 5. The department shall before November 1, 2010, make
recommendations in an electronic format under IC 5-14-6 to the
legislative council concerning any legislative changes needed to
implement the guidelines and procedures developed under this
chapter, including a budgetary recommendation for the
implementation of the guidelines and procedures and a funding
mechanism, to the extent possible, which must include a fee. As added by P.L.110-2010, SEC.22.
IC 22-2-15-6 Rule adoption and implementation
Sec. 6. After considering any recommendations by the pension
management oversight commission, the department shall convert the
guidelines and procedures to rules by adopting rules under IC 4-22-2
before August 1, 2011. The department shall implement the rules
before August 1, 2011. As added by P.L.110-2010, SEC.22.
IC 22-2-15
Chapter 15. Guidelines and Procedures for Investigating
Questions and Complaints Concerning Employee Classification
IC 22-2-15-1 "Department"
Sec. 1. As used in this chapter, "department" refers to the
department of labor created by IC 22-1-1-1. As added by P.L.110-2010, SEC.22.
IC 22-2-15-2 Development of guidelines and procedures concerning employee
classification; contents; exemptions; plan for implementation
Sec. 2. (a) The department shall develop guidelines and
procedures for investigating questions and complaints concerning
employee classification and a plan for implementation of those
guidelines and procedures.
(b) The guidelines and procedures must do the following:
(1) Cover at least the following:
(A) Who is eligible to file a complaint. The guidelines and
procedures must allow any aggrieved person to file a
complaint and must indicate what evidence is needed to
initiate an investigation.
(B) Applicable and appropriate penalties, taking into
consideration:
(i) the financial impact on both employers and
misclassified employees; and
(ii) whether the employer has previously misclassified
employees.
(C) Mechanisms to share data with appropriate state
agencies to assist those agencies in determining compliance
with and enforcing state laws concerning misclassified
employees and to recoup contributions owed, depending on
the level of culpability.
(D) Record keeping requirements for contractors, including
any records necessary for the department to investigate
alleged violations concerning misclassification of
employees.
(E) Investigative procedures.
(2) Apply to public works and private work projects for the
construction industry (as described in IC 4-13.5-1-1(3)),
including demolition.
(3) Apply to any contractor that engages in construction and is
authorized to do business in Indiana.
(4) Provide a remedy for an employer or a misclassified
employee in response to:
(A) any retaliation that occurs as the result of an
investigation or a complaint; and
(B) any complaints that the department determines are
frivolous or that are filed for the purpose of harassment.
(5) Provide that in carrying out this chapter the department has
the same inspection, investigative, and enforcement powers that
the department has in enforcing the labor laws of this state,
including powers described in IC 22-1-1.
(c) The guidelines and procedures may include other elements as
determined by the department.
(d) The department shall exempt the following from the
guidelines and procedures developed under this chapter:
(1) Residential construction of a single family home or duplex
if the builder builds less than twenty-five (25) units each year.
(2) An owner-operator that provides a motor vehicle and the
services of a driver under a written contract that is subject to
IC 8-2.1-24-23, 45 IAC 16-1-13, or 49 CFR 376, to a motor
carrier. As added by P.L.110-2010, SEC.22.
IC 22-2-15-3 Use of Internal Revenue Code definitions; use of Internal Revenue
Service factors
Sec. 3. In developing the guidelines and procedures under this
chapter, the department shall use:
(1) the definition of "employee" used in Section 3401(c) of the
Internal Revenue Code; and
(2) the following factors used by the Internal Revenue Service
to determine whether a worker is an independent contractor:
(A) Instructions. A worker who is required to comply with
other persons' instructions about when, where, and how he
or she is to work is ordinarily an employee. This control
factor is present if the person or persons for whom the
services are performed have the right to require compliance
with instructions. See, for example, Rev. Rul. 68-598,
1968-2 C.B. 464, and Rev. Rul. 66-381, 1966-2 C.B. 449.
(B) Training. Training a worker by requiring an experienced
employee to work with the worker, by corresponding with
the worker, by requiring the worker to attend meetings, or by
using other methods, indicates that the person or persons for
whom the services are performed want the services
performed in a particular method or manner. See Rev. Rul.
70-630, 1970-2 C.B. 229.
(C) Integration. Integration of the worker's services into the
business operations generally shows that the worker is
subject to direction and control. When the success or
continuation of a business depends to an appreciable degree
upon the performance of certain services, the workers who
perform those services must necessarily be subject to a
certain amount of control by the owner of the business. See
United States v. Silk, 331 U.S. 704 (1947), 1947-2 C.B. 167.
(D) Services rendered personally. If the services must be
rendered personally, presumably the person or persons for
whom the services are performed are interested in the
methods used to accomplish the work as well as in the
results. See Rev. Rul. 55-695, 1955-2 C.B. 410.
(E) Hiring, supervising, and paying assistants. If the person
or persons for whom the services are performed hire,
supervise, and pay assistants, that factor generally shows
control over the workers on the job. However, if one (1)
worker hires, supervises, and pays the other assistants under
a contract under which the worker agrees to provide
materials and labor and under which the worker is
responsible only for the attainment of a result, this factor
indicates an independent contractor status. Compare Rev.
Rul. 63-115, 1963-1 C.B. 178, with Rev. Rul. 55-593 1955-2
C.B. 610.
(F) Continuing relationship. A continuing relationship
between the worker and the person or persons for whom the
services are performed indicates that an employer-employee
relationship exists. A continuing relationship may exist
where work is performed at frequently recurring although
irregular intervals. See United States v. Silk.
(G) Set hours of work. The establishment of set hours of
work by the person or persons for whom the services are
performed is a factor indicating control. See Rev. Rul.
73-591, 1973-2 C.B. 337.
(H) Full time required. If the worker must devote
substantially full time to the business of the person or
persons for whom the services are performed, such person or
persons have control over the amount of time the worker
spends working and impliedly restrict the worker from doing
other gainful work. An independent contractor on the other
hand, is free to work when and for whom he or she chooses.
See Rev. Rul. 56-694, 1956-2 C.B. 694.
(I) Doing work on employer's premises. If the work is
performed on the premises of the person or persons for
whom the services are performed, that factor suggests
control over the worker, especially if the work could be done
elsewhere. Rev. Rul. 56-660, 1956-2 C.B. 693. Work done
off the premises of the person or persons receiving the
services, such as at the office of the worker, indicates some
freedom from control. However, this fact by itself does not
mean that the worker is not an employee. The importance of
this factor depends on the nature of the service involved and
the extent to which an employer generally would require that
employees perform such services on the employer's
premises. Control over the place of work is indicated when
the person or persons for whom the services are performed
have the right to compel the worker to travel a designated
route, to canvass a territory within a certain time, or to work
at specific places as required. See Rev. Rul. 56-694.
(J) Order of sequence set. If a worker must perform services
in the order or sequence set by the person or persons for
whom the services are performed, that factor shows that the
worker is not free to follow the worker's own pattern of work
but must follow the established routines and schedules of the
person or persons for whom the services are performed.
Often, because of the nature of an occupation, the person or
persons for whom the services are performed do not set the
order of the services or set the order infrequently. It is
sufficient to show control, however, if such person or
persons retain the right to do so. See Rev. Rul. 56-694.
(K) Oral or written reports. A requirement that the worker
submit regular or written reports to the person or persons for
whom the services are performed indicates a degree of
control. See Rev. Rul. 70-309, 1970-1 C.B. 199, and Rev.
Rul. 68-248, 1968-1 C.B. 431.
(L) Payment by hour, week, month. Payment by the hour,
week, or month generally points to an employer-employee
relationship, if this method of payment is not just a
convenient way of paying a lump sum agreed upon as the
cost of a job. Payment made by the job or on a straight
commission generally indicates that the worker is an
independent contractor. See Rev. Rul. 74-389, 1974-2 C.B.
330.
(M) Payment of business and traveling expenses. If the
person or persons for whom the services are performed
ordinarily pay the worker's business or traveling expenses or
business and traveling expenses, the worker is ordinarily an
employee. An employer, to be able to control expenses,
generally retains the right to regulate and direct the worker's
business activities. See Rev. Rul. 55-144, 1955-1 C.B. 483.
(N) Furnishing of tools and materials. The fact that the
person or persons for whom the services are performed
furnish significant tools, materials, and other equipment
tends to show the existence of an employer-employee
relationship. See Rev. Rul. 71-524, 1971-2 C.B. 346.
(O) Significant investment. If the worker invests in facilities
that are used by the worker in performing services and are
not typically maintained by employees (such as the
maintenance of an office rented at fair value from an
unrelated party), that factor tends to indicate that the worker
is an independent contractor. On the other hand, lack of
investment in facilities indicates dependence on the person
or persons for whom the services are performed for such
facilities and, accordingly, the existence of an
employer-employee relationship. See Rev. Rul. 71-524.
Special scrutiny is required with respect to certain types of
facilities, such as home offices.
(P) Realization of profit or loss. A worker who can realize a
profit or suffer a loss as a result of the worker's services (in
addition to the profit or loss ordinarily realized by
employees) is generally an independent contractor, but the
worker who cannot is an employee. See Rev. Rul. 70-309.
For example, if the worker is subject to a real risk of
economic loss due to significant investments or a bona fide
liability for expenses, such as salary payments to unrelated
employees, that factor indicates that the worker is an
independent contractor. The risk that a worker will not
receive payment for his or her services, however, is common
to both independent contractors and employees and thus
does not constitute a sufficient economic risk to support
treatment as an independent contractor.
(Q) Working for more than one (1) firm at a time. If a
worker performs more than de minimis services for a
multiple of unrelated persons or firms at the same time, that
factor generally indicates that the worker is an independent
contractor. See Rev. Rul. 70-572, 1970-2 C.B. 221.
However, a worker who performs services for more than one
(1) person may be an employee of each of the persons,
especially where such persons are part of the same service
arrangement.
(R) Making service available to general public. The fact that
a worker makes his or her services available to the general
public on a regular and consistent basis indicates an
independent contractor relationship. See Rev. Rul. 56-660.
(S) Right to discharge. The right to discharge a worker is a
factor indicating that the worker is an employee and the
person possessing the right is an employer. An employer
exercises control through the threat of dismissal, which
causes the worker to obey the employer's instructions. An
independent contractor, on the other hand, cannot be fired so
long as the independent contractor produces a result that
meets the contract specifications. Rev. Rul. 75-41, 1975-1
C.B. 323.
(T) Right to terminate. If the worker has the right to end his
or her relationship with the person for whom the services are
performed at any time he or she wishes without incurring
liability, that factor indicates an employer-employee
relationship. See Rev. Rul. 70-309.
(U) Any other guidelines under IC 22-3-6-1(b) and
IC 22-3-7-9(b)(5). As added by P.L.110-2010, SEC.22.
IC 22-2-15-4 Presentation to pension management oversight commission
Sec. 4. The department shall make a presentation to the pension
management oversight commission not later than October 1, 2010,
outlining the proposed guidelines and procedures. As added by P.L.110-2010, SEC.22.
IC 22-2-15-5 Recommendations to legislative council
Sec. 5. The department shall before November 1, 2010, make
recommendations in an electronic format under IC 5-14-6 to the
legislative council concerning any legislative changes needed to
implement the guidelines and procedures developed under this
chapter, including a budgetary recommendation for the
implementation of the guidelines and procedures and a funding
mechanism, to the extent possible, which must include a fee. As added by P.L.110-2010, SEC.22.
IC 22-2-15-6 Rule adoption and implementation
Sec. 6. After considering any recommendations by the pension
management oversight commission, the department shall convert the
guidelines and procedures to rules by adopting rules under IC 4-22-2
before August 1, 2011. The department shall implement the rules
before August 1, 2011. As added by P.L.110-2010, SEC.22.
IC 22-2-15
Chapter 15. Guidelines and Procedures for Investigating
Questions and Complaints Concerning Employee Classification
IC 22-2-15-1 "Department"
Sec. 1. As used in this chapter, "department" refers to the
department of labor created by IC 22-1-1-1. As added by P.L.110-2010, SEC.22.
IC 22-2-15-2 Development of guidelines and procedures concerning employee
classification; contents; exemptions; plan for implementation
Sec. 2. (a) The department shall develop guidelines and
procedures for investigating questions and complaints concerning
employee classification and a plan for implementation of those
guidelines and procedures.
(b) The guidelines and procedures must do the following:
(1) Cover at least the following:
(A) Who is eligible to file a complaint. The guidelines and
procedures must allow any aggrieved person to file a
complaint and must indicate what evidence is needed to
initiate an investigation.
(B) Applicable and appropriate penalties, taking into
consideration:
(i) the financial impact on both employers and
misclassified employees; and
(ii) whether the employer has previously misclassified
employees.
(C) Mechanisms to share data with appropriate state
agencies to assist those agencies in determining compliance
with and enforcing state laws concerning misclassified
employees and to recoup contributions owed, depending on
the level of culpability.
(D) Record keeping requirements for contractors, including
any records necessary for the department to investigate
alleged violations concerning misclassification of
employees.
(E) Investigative procedures.
(2) Apply to public works and private work projects for the
construction industry (as described in IC 4-13.5-1-1(3)),
including demolition.
(3) Apply to any contractor that engages in construction and is
authorized to do business in Indiana.
(4) Provide a remedy for an employer or a misclassified
employee in response to:
(A) any retaliation that occurs as the result of an
investigation or a complaint; and
(B) any complaints that the department determines are
frivolous or that are filed for the purpose of harassment.
(5) Provide that in carrying out this chapter the department has
the same inspection, investigative, and enforcement powers that
the department has in enforcing the labor laws of this state,
including powers described in IC 22-1-1.
(c) The guidelines and procedures may include other elements as
determined by the department.
(d) The department shall exempt the following from the
guidelines and procedures developed under this chapter:
(1) Residential construction of a single family home or duplex
if the builder builds less than twenty-five (25) units each year.
(2) An owner-operator that provides a motor vehicle and the
services of a driver under a written contract that is subject to
IC 8-2.1-24-23, 45 IAC 16-1-13, or 49 CFR 376, to a motor
carrier. As added by P.L.110-2010, SEC.22.
IC 22-2-15-3 Use of Internal Revenue Code definitions; use of Internal Revenue
Service factors
Sec. 3. In developing the guidelines and procedures under this
chapter, the department shall use:
(1) the definition of "employee" used in Section 3401(c) of the
Internal Revenue Code; and
(2) the following factors used by the Internal Revenue Service
to determine whether a worker is an independent contractor:
(A) Instructions. A worker who is required to comply with
other persons' instructions about when, where, and how he
or she is to work is ordinarily an employee. This control
factor is present if the person or persons for whom the
services are performed have the right to require compliance
with instructions. See, for example, Rev. Rul. 68-598,
1968-2 C.B. 464, and Rev. Rul. 66-381, 1966-2 C.B. 449.
(B) Training. Training a worker by requiring an experienced
employee to work with the worker, by corresponding with
the worker, by requiring the worker to attend meetings, or by
using other methods, indicates that the person or persons for
whom the services are performed want the services
performed in a particular method or manner. See Rev. Rul.
70-630, 1970-2 C.B. 229.
(C) Integration. Integration of the worker's services into the
business operations generally shows that the worker is
subject to direction and control. When the success or
continuation of a business depends to an appreciable degree
upon the performance of certain services, the workers who
perform those services must necessarily be subject to a
certain amount of control by the owner of the business. See
United States v. Silk, 331 U.S. 704 (1947), 1947-2 C.B. 167.
(D) Services rendered personally. If the services must be
rendered personally, presumably the person or persons for
whom the services are performed are interested in the
methods used to accomplish the work as well as in the
results. See Rev. Rul. 55-695, 1955-2 C.B. 410.
(E) Hiring, supervising, and paying assistants. If the person
or persons for whom the services are performed hire,
supervise, and pay assistants, that factor generally shows
control over the workers on the job. However, if one (1)
worker hires, supervises, and pays the other assistants under
a contract under which the worker agrees to provide
materials and labor and under which the worker is
responsible only for the attainment of a result, this factor
indicates an independent contractor status. Compare Rev.
Rul. 63-115, 1963-1 C.B. 178, with Rev. Rul. 55-593 1955-2
C.B. 610.
(F) Continuing relationship. A continuing relationship
between the worker and the person or persons for whom the
services are performed indicates that an employer-employee
relationship exists. A continuing relationship may exist
where work is performed at frequently recurring although
irregular intervals. See United States v. Silk.
(G) Set hours of work. The establishment of set hours of
work by the person or persons for whom the services are
performed is a factor indicating control. See Rev. Rul.
73-591, 1973-2 C.B. 337.
(H) Full time required. If the worker must devote
substantially full time to the business of the person or
persons for whom the services are performed, such person or
persons have control over the amount of time the worker
spends working and impliedly restrict the worker from doing
other gainful work. An independent contractor on the other
hand, is free to work when and for whom he or she chooses.
See Rev. Rul. 56-694, 1956-2 C.B. 694.
(I) Doing work on employer's premises. If the work is
performed on the premises of the person or persons for
whom the services are performed, that factor suggests
control over the worker, especially if the work could be done
elsewhere. Rev. Rul. 56-660, 1956-2 C.B. 693. Work done
off the premises of the person or persons receiving the
services, such as at the office of the worker, indicates some
freedom from control. However, this fact by itself does not
mean that the worker is not an employee. The importance of
this factor depends on the nature of the service involved and
the extent to which an employer generally would require that
employees perform such services on the employer's
premises. Control over the place of work is indicated when
the person or persons for whom the services are performed
have the right to compel the worker to travel a designated
route, to canvass a territory within a certain time, or to work
at specific places as required. See Rev. Rul. 56-694.
(J) Order of sequence set. If a worker must perform services
in the order or sequence set by the person or persons for
whom the services are performed, that factor shows that the
worker is not free to follow the worker's own pattern of work
but must follow the established routines and schedules of the
person or persons for whom the services are performed.
Often, because of the nature of an occupation, the person or
persons for whom the services are performed do not set the
order of the services or set the order infrequently. It is
sufficient to show control, however, if such person or
persons retain the right to do so. See Rev. Rul. 56-694.
(K) Oral or written reports. A requirement that the worker
submit regular or written reports to the person or persons for
whom the services are performed indicates a degree of
control. See Rev. Rul. 70-309, 1970-1 C.B. 199, and Rev.
Rul. 68-248, 1968-1 C.B. 431.
(L) Payment by hour, week, month. Payment by the hour,
week, or month generally points to an employer-employee
relationship, if this method of payment is not just a
convenient way of paying a lump sum agreed upon as the
cost of a job. Payment made by the job or on a straight
commission generally indicates that the worker is an
independent contractor. See Rev. Rul. 74-389, 1974-2 C.B.
330.
(M) Payment of business and traveling expenses. If the
person or persons for whom the services are performed
ordinarily pay the worker's business or traveling expenses or
business and traveling expenses, the worker is ordinarily an
employee. An employer, to be able to control expenses,
generally retains the right to regulate and direct the worker's
business activities. See Rev. Rul. 55-144, 1955-1 C.B. 483.
(N) Furnishing of tools and materials. The fact that the
person or persons for whom the services are performed
furnish significant tools, materials, and other equipment
tends to show the existence of an employer-employee
relationship. See Rev. Rul. 71-524, 1971-2 C.B. 346.
(O) Significant investment. If the worker invests in facilities
that are used by the worker in performing services and are
not typically maintained by employees (such as the
maintenance of an office rented at fair value from an
unrelated party), that factor tends to indicate that the worker
is an independent contractor. On the other hand, lack of
investment in facilities indicates dependence on the person
or persons for whom the services are performed for such
facilities and, accordingly, the existence of an
employer-employee relationship. See Rev. Rul. 71-524.
Special scrutiny is required with respect to certain types of
facilities, such as home offices.
(P) Realization of profit or loss. A worker who can realize a
profit or suffer a loss as a result of the worker's services (in
addition to the profit or loss ordinarily realized by
employees) is generally an independent contractor, but the
worker who cannot is an employee. See Rev. Rul. 70-309.
For example, if the worker is subject to a real risk of
economic loss due to significant investments or a bona fide
liability for expenses, such as salary payments to unrelated
employees, that factor indicates that the worker is an
independent contractor. The risk that a worker will not
receive payment for his or her services, however, is common
to both independent contractors and employees and thus
does not constitute a sufficient economic risk to support
treatment as an independent contractor.
(Q) Working for more than one (1) firm at a time. If a
worker performs more than de minimis services for a
multiple of unrelated persons or firms at the same time, that
factor generally indicates that the worker is an independent
contractor. See Rev. Rul. 70-572, 1970-2 C.B. 221.
However, a worker who performs services for more than one
(1) person may be an employee of each of the persons,
especially where such persons are part of the same service
arrangement.
(R) Making service available to general public. The fact that
a worker makes his or her services available to the general
public on a regular and consistent basis indicates an
independent contractor relationship. See Rev. Rul. 56-660.
(S) Right to discharge. The right to discharge a worker is a
factor indicating that the worker is an employee and the
person possessing the right is an employer. An employer
exercises control through the threat of dismissal, which
causes the worker to obey the employer's instructions. An
independent contractor, on the other hand, cannot be fired so
long as the independent contractor produces a result that
meets the contract specifications. Rev. Rul. 75-41, 1975-1
C.B. 323.
(T) Right to terminate. If the worker has the right to end his
or her relationship with the person for whom the services are
performed at any time he or she wishes without incurring
liability, that factor indicates an employer-employee
relationship. See Rev. Rul. 70-309.
(U) Any other guidelines under IC 22-3-6-1(b) and
IC 22-3-7-9(b)(5). As added by P.L.110-2010, SEC.22.
IC 22-2-15-4 Presentation to pension management oversight commission
Sec. 4. The department shall make a presentation to the pension
management oversight commission not later than October 1, 2010,
outlining the proposed guidelines and procedures. As added by P.L.110-2010, SEC.22.
IC 22-2-15-5 Recommendations to legislative council
Sec. 5. The department shall before November 1, 2010, make
recommendations in an electronic format under IC 5-14-6 to the
legislative council concerning any legislative changes needed to
implement the guidelines and procedures developed under this
chapter, including a budgetary recommendation for the
implementation of the guidelines and procedures and a funding
mechanism, to the extent possible, which must include a fee. As added by P.L.110-2010, SEC.22.
IC 22-2-15-6 Rule adoption and implementation
Sec. 6. After considering any recommendations by the pension
management oversight commission, the department shall convert the
guidelines and procedures to rules by adopting rules under IC 4-22-2
before August 1, 2011. The department shall implement the rules
before August 1, 2011. As added by P.L.110-2010, SEC.22.
