Among James Bond films, Rotten Tomatoes ranks Never Say Never Again 18th out of 26, with a mediocre 63% rating. (Bond movie quiz at the end of this post, for patient readers.)
It’s a cliche saying, I know, but my first reaction when asked this question was, “I’d never say never, but it’s hard to imagine a scenario where that would work.” (That was also my second reaction and my third. Let’s just say that’s my reaction.)
Let’s run this through the gauntlet. Remember, it’s not your choice whether an intern is an independent contractor or an employee. The law decides that for you, based on the nature of the relationship.
Test #1: Economic Realities Test. Under federal wage and hour laws, an independent contractor must be in business for himself/herself and not economically reliant on the company. A student intern is not likely to meet this test. I can envision a scenario where a student is a freelance photographer or journalist, providing output for several publications on her own time and at places of her choosing. That could be a legitimate independent contractor, but that sounds nothing like a summer internship.
The more common scenario — where someone works 20-40 hours for one company, without operating a solo business, without other customers, and without investing in tools and equipment — well, lets just say that the highest ranked Bond movie was Dr. No. (Rotten Tomatoes score: 96%!)
Test #2: Right to Control Test. The IRS and most anti-discrimination laws apply a Right to Control Test to determine whether someone is an employee under the law. Unless you like to roll the dice with the tax man, you probably don’t want to get this one wrong. (Casino Royale? The 1967 version is in last place with a measly Rotten Tomatoes score of 29%.)
Typically, an intern is told where to work, what days to work, what location to work, can’t hire helpers, reports to a supervisor or mentor, gets evaluated, receives assignments, and uses the company’s equipment to perform whatever projects are assigned. That’s a world of bad facts if trying to support independent contractor status. (The World is Not Enough, 51%.) Highly unlikely. Taxes and withholdings are most likely owed, like it or not.
Test #3: ABC Tests. Several states use ABC tests to determine whether someone is an employee for purposes of workers compensation and unemployment eligibility. Unemployment is probably not an issue for summer interns, since their terms are generally fixed at a few months. Workers comp could be a different story, however, and both you and the intern could be unprotected if your misclassified contractor should have been deemed an employee. ABC Tests are hard to satisfy.
Final Analysis: I don’t mean to scare The Living Daylights out of you (Rotten Tomatoes score: 70%), but it’s pretty unlikely your intern can be properly classified as an independent contractor. Each set of circumstances has to be evaluated on its own, but if you run the facts through the proper tests, your intern is probably an employee under the relevant laws.
James Bond Movie Quiz: Three Bond films share the highest Rotten Tomatoes score at 96%. Can you name them? Hint: The 2005 version of Casino Royale is close behind at 95%, but didn’t make the cut. Click here for the answer.
© 2017 Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment. All rights reserved.