Glossary

  • ABC Test. A test used for determining whether an worker is an employee under some legal standards, most commonly under state workers compensation or unemployment laws. This test begins with the presumption that a worker is an employee and requires the hiring party to proof each of three separate factors (A, B, and C) to overcome that presumption and establish that the worker is a non-employee.
  • Browning-Ferris. A 2015 decision by the National Labor Relations Board (NLRB) that significantly expanded the definition of joint employment under the National Labor Relations Act. 362 NLRB No. 186.
  • Contingent Worker.  This is a broad, catch-all term used to refer to workers who are not regular full-time employees.  Examples of contingent workers include seasonal, part-time or temporary employees; as well as non-employees such as independent contractors and Someone Else’s Employees (defined below), which may include staffing agency workers retained on a temporary or short-term basis.  There may be misclassification or joint employment issues with the non-employee types of contingent workers.  Before you can assess the risks of using contingent workers, you need to know which kind of contingent workers are being used.
  • Contract worker. This is an ambiguous term, and employers use it to mean different things. It can be properly used to refer to an individual independent contractor.  Employers also frequently use this term to refer to a staffing agency worker (i.e., Someone Else’s Employee, see definition below) because the worker is being supplied through a contract with a staffing agency.  If you hear this term, ask for clarification.  The legal issues, standards, risks, and potential liabilities are different under the two scenarios.  In the first scenario, the legal issue is whether the IC is misclassified and should be that company’s employee.  In the second scenario, the worker is already the staffing agency’s employee, and the issue is whether the worker is also a joint employee of the company benefiting from the worker’s services.
  • Darden Test. A type of Right to Control Test, articulated by the U.S. Supreme Court in the 1992 case, Nationwide Mut. Ins. v. Darden, 503 U.S. 318.
  • Economic Realities Test. A test used for determining whether an worker is an employee under some legal standards, including the Fair Labor Standards Act (FLSA). This test seeks to determine whether the worker, as a matter of economic reality, is dependent on the hiring party to make a living. If yes, the worker is likely an employee.
  • Employee. A worker who is deemed to be an employee under the applicable legal standard, regardless of how the hiring party treated the worker. I know, it’s circular, but so are most definitions of employee in the federal statues. Click here for more on that. See also W-2 Employee, defined below.
  • Independent Contractor. A worker who is treated as self-employed and who is paid in gross, without any of the withholding or deductions required for employees. See also 1099 Independent Contractor.
  • IC. My shortcut for Independent Contractor. I will be using this acronym.
  • ICM. My shortcut for Independent Contractor Misclassification. I will be using this acronym.
  • ICBM. Intercontinental Ballistic Missile. I will not be using this acronym.
  • Joint Employee. A worker who is deemed an employee of more than one entity.  (It doesn’t mean this.)
  • Misclassification. (1) In the context of this blog, the term means Independent Contractor Misclassification — in other words, a worker is being treated as an independent contractor but, under the applicable legal standard, is actually an employee and should have been treated as an employee. (2) The term Misclassification is also commonly used to refer to an employee who is being treated as exempt from the overtime requirements in the Fair Labor Standards Act (FLSA), but who, when the proper legal test for exempt status is applied, does not actually qualify for any exemption and instead should be treated as non-exempt (eligible for overtime pay).  Definition (1) is a focal point of this blog; definition (2) is not.
  • Right to Control Test. A test used for determining whether an worker is an employee under some legal standards. This test seeks to determine whether the hiring party has the right to control the means and manner in which the work is performed. If yes, the worker is likely an employee. Click here for more information.
  • Someone Else’s Employee. Obviously, not a fancy term of art. Someone Else’s Employee is a regular W-2 Employee of one entity, such as a staffing agency or a consulting firm, but who may also be joint employed by another entity.  For our purposes, the issue is whether the individual is a joint employee.
  • Temp or Temporary Employee. This is an ambiguous term, and employers use it to mean different things. It may mean a company’s W-2 Employee who is treated like an employee but was hired to fill a temporary need and is not expected to remain employed for more than several months. Or, it may mean Someone Else’s Employee, i.e., the employee of a staffing agency who is providing services to another firm, in which case the worker may be a joint employee. If you hear this term used, seek clarification.
  • W-2 Employee. A worker who is treated as an employee under the Internal Revenue Code and whose income is reported on a Form W-2.  Click here for more about how the IRS determines who is an employee.
  • 1099 Independent Contractor. A worker who is treated as self-employed for tax purposes, who is paid in gross (without any of the withholding or deductions required for employees), and whose compensation is reported on a Form 1099.
  • Zopissa. A medicinal preparation made from wax and pitch scraped from the sides of ships. Just in case you were wondering.