| Considerations for Specific Businesses |
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Here are some factors businesses can use to determine if a worker is an independent contractor or an employee. This information is not a statement of public policy. It is based on court cases in Oregon. No one factor determines when a worker is an employee or independent contractor.
ORS 670.600 applies only to the Oregon Department of Revenue, Employment Department, Construction Contractors Board, and Landscape Contractors Board. These agencies require that the person performing the work must meet all the criteria of that law.
For information about workers' compensation and Oregon labor law, please contact the Workers' Compensation Division and Bureau of Labor and Industries.
It is not possible to address every business situation. For more information that might apply to your business, contact:
Basic factors for all types of business:
Consider these questions in every business situation:
- Is the worker free from direction and control?
- Does the business direct the worker's conduct on the job?
- Does the business control the methods used to do the work?
- Does the business direct the worker in any way other than the desired outcome or product?
- Does the business have the right to control any of the conditions or circumstances surrounding the work?
- Does the worker have an independently established business?
- Does the worker maintain a separate business location away from the work site?
- Does the worker maintain a business enterprise in a part of his or her home?
- Will the worker bear a loss if errors are made in the performance of the work at the work site?
- Is the work performed based on the terms of a fixed price contract or on an hourly or piece rate basis?
- Is the worker required to fix any defects in the work at his or her own cost?
- Does the worker guarantee his or her services?
- Does the worker provide insurance agreements for the work?
- Does the worker perform services for two or more different people in a year?
- Does the worker market his or her services to get customers?
- Does the worker have a significant investment in the business?
- Does the worker provide and pay for his or her own tools and equipment?
- Does the worker pay for the facility where the services are provided?
- Has the worker invested in specialized training?
- Does the worker have the right to hire or fire other workers?
- Has the worker created a business entity such as a corporation or limited liability company?
- Does the business meet the independent contractor requirements in ORS 670.600?
Other factors to consider in specific industries
Agricultural employment
A crew leader may be the employer of the crew.
- Does the crew leader have a valid Certificate of Registration under the Federal Migrant and Seasonal Agricultural Worker Protection Act?
- Do crew members operate or maintain mechanized equipment provided by the crew leader?
Auto repair/detailing
Auto mechanics and detail workers are sometimes treated as independent contractors. Some may use their own tools and equipment and have specialized licenses. Does the worker:
- Provide his or her own materials and supplies?
- Schedule when and where to perform the work?
- Have his or her own customer base?
- Set the price?
- Pay a flat rate for business space?
- Choose which customers to serve?
- Can the worker (or the rental contract) be fired for not being present at the shop?
Barber/beauty/nail salons
Some salon workers rent space from the shop owner and may have specialized licenses or credentials.
- If the worker rents space at a shop or salon, is the rent a flat rate, or is the rate based on services provided?
- Does the worker provide his or her own equipment and supplies?
- Who schedules appointments?
- Does the worker have to tell the shop owner about comings and goings?
- Who sets the price of the services?
- Can the worker (or the rental contract) be fired for not being present at the shop?
- Does the worker have a specialized license or credential?
Computer programmers/software designers
- Does the worker provide a good or a service based on a service agreement or contract?
- The client specifies the end product. Does the client control any other aspect?
Consultants
- Is the worker providing a good or a service based on a service agreement or contract?
- The client specifies the end product. Does the client control any other aspect?
- Is the worker a fixed part of the client's production system?
Cottage industries (making and selling homemade products):
- Do businesses buy goods or services from the worker?
- Does the worker provide the equipment, materials, and supplies needed to make the product?
- Who decides when, where, and to whom the goods are sold?
- Who sets the price of the products?
- Does the worker have other customers?
- May the worker sell the same product to any customer they choose?
In-home care:
People who provide in-home care are sometimes treated as independent contractors. They sometimes have specialized licenses or credentials.
- Does the worker have his or her own clients?
- Who decides the price?
- Who decides which customers will be cared for at any given time?
- May the worker contract with those they care for or with other family members directly?
Insurance (people performing insurance-related services)
- Specifically, what kind of service is being performed?
- How is the worker paid?
Internet-based service
People who work for Internet-based services may work on a computer from almost anywhere, for a business or client located almost anywhere.
- Does the worker provide a service based on a service agreement or contract?
- The client specifies the end product. Does the client control any other aspect?
- Is the worker a fixed part of the client's production system?
Loan officers/loan originators:
In the mortgage banking industry, some loan officers and loan originators are sometimes classified as independent contractors by the mortgage banker or mortgage broker.
- To keep a license in good standing, does the mortgage broker or banker direct and control the loan officer or loan originator under ORS Chapter 59 (Mortgage Banking)?
Long-haul truck drivers
- Who furnishes and maintains the vehicle?
- What are the contract conditions?
Machine operators (forklift drivers, crane operators, and other equipment operators)
- Is the worker a fixed part of the client's production system?
- Who furnishes and maintains the equipment?
Maintenance/janitorial/custodial
- Does the worker provide his or her own equipment and supplies?
- Who schedules work?
- Who sets the price of the services?
- Whose customers are being served?
- Who controls who the customers will be?
- Can the worker contract directly with the customer?
Medical professionals
- Where is the worker's business located?
- Who sets work hours?
- Does the worker have to comply with the schedules of a hospital or office?
- Can the worker make independent decisions about who will be served and when?
- Does the worker advertise for customers in his or her own name?
- Whose goodwill and profit is affected by the services performed?
- Does anyone other than the worker insure the service?
Office personnel (clerical staff, clerks, managers)
- Does the worker provide his or her own materials and supplies?
- Does the worker schedule when and where to perform the work?
- Does the worker have his or her own customers?
- Does the worker set the price for services?
- Does the worker pay a flat rate for business space?
- Does the worker provide a good or a service based on a service agreement or contract?
- The client specifies the end product. Does the client control any other aspect?
- Is the worker a fixed part of the client's production system?
Petition signature gatherers
Signature gathers are hired directly or through a crew leader.
- Does the crew leader gather signatures for other customers?
- Does the crew leader have a place of business?
- Does the crew leader set or negotiate the price to pay workers for gathering signatures?
- Is the crew or the crew leader subject to supervision?
- Who sets work hours for the signature gatherers?
- Who decides where the signature gathers will perform their work?
- Who pays the signature gathers?
- Is pay based on hours of work or the number of signatures gathered?
Pharmacists:
Pharmacies often treat relief pharmacists as independent contractors.
- Where is the pharmacist's business located?
- Who sets work hours ?
- Does the pharmacist have to comply with the schedules of a hospital or office?
- Can the pharmacist make independent decisions about who will be served and when?
- Does the pharmacist advertise for customers using his or her own name?
- Whose goodwill and profit is affected by the services performed?
- Does anyone other than the pharmacist insure the service?
Political Campaigns
Some paid campaign workers are classified as independent contractors.
- Does the worker have a business doing the same services for other campaigns or organizations?
- Does the worker have a business location?
Sales:
Some people do sales work as independent contractors.
- Does the salesperson choose his or her customers and sales area?
- Does the salesperson contract with more than one supplier of sales goods?
- Does the salesperson do business from his or her own location?
Telemarketing
People who work for telemarketing services may work from their home or a call center.
- Does the worker provide a good or a service based on a service agreement or contract?
- The client specifies the end product. Does the client control any other aspect?
- Is the worker a fixed part of the client's production system?
- Does the worker provide his or her own materials and supplies?
- Does the worker schedule when and where to perform the work?
- Does the worker have his own customers ?
- Does the worker set the price for services?
- Does the worker pay a flat rate for business space?
Travel agents
- Where is the worker's business located?
- Who sets work hours ?
- Does the worker have to comply with the schedules of an office?
- Can the worker make independent decisions about who will be served and when?
- Does the worker advertise for customers in his or her own name?
- Whose goodwill and profit is affected by the services performed?
- Does anyone other than the worker insure the service?
- Can the worker deal directly with the ticketing industry without connecting to another travel agency or travel office?
- The client specifies the end product. Does the client control any other aspect?
Note: Payments for some services can be excluded from the definition of wages for payroll reporting purposes. This does not mean the worker is an independent contractor. It only means that the amounts paid will not be reported as wages to an employee. Exclusions vary based on Oregon law. To find out more about the definition of "wages" for payroll reporting purposes, please contact:
ORS 670.600 applies only to the Oregon Department of Revenue, Employment Department, Construction Contractors Board, and Landscape Contractors Board. These agencies require that the person performing the work must meet all the criteria of that law.
For information about workers' compensation and Oregon labor law, please contact the Workers' Compensation Division and Bureau of Labor and Industries.
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