CCWP Worker Classification & Independent Contractor Compliance 2

Question 1

California's Assembly Bill 5 (AB5) primarily codified which worker classification test into state law?

Accepted Answer

The ABC Test

Answer

AB5 codified California's Dynamex ABC Test, requiring companies to prove three criteria (A, B, C) before classifying a worker as an independent contractor.

Question 2

What does Part B of the ABC Test require a hiring company to demonstrate about an independent contractor?

Accepted Answer

The worker performs work outside the usual course of the company's business

Answer

Part B of the ABC Test requires that the worker performs work that is outside the usual course of the hiring entity's business, distinguishing true contractors from core business workers.

Question 3

IRS Section 530 Safe Harbor relief protects companies from employment tax liability for worker misclassification if the company meets which primary condition?

Accepted Answer

The company has a reasonable basis for treating the worker as a contractor and has been consistent in that treatment

Answer

Section 530 Safe Harbor requires a reasonable basis for contractor treatment (such as reliance on industry practice, prior IRS audit, or court ruling) plus consistent treatment and 1099 filing.

Question 4

Which IRS form can a business or worker file to request an official determination of a worker's employment status?

Accepted Answer

Form SS-8

Answer

Form SS-8 (Determination of Worker Status for Purposes of Federal Employment Taxes) is filed to ask the IRS to make an official determination on whether a worker is an employee or independent contractor.

Question 5

Under the FLSA economic realities test, which factor examines whether the worker's services are integral to the employer's business?

Accepted Answer

Integral part of the principal's business

Answer

The 'integral part of the principal's business' factor assesses whether the worker's services are central to the employer's core operations, indicating economic dependence and employee status.

CCWP - Certified Contingent Workforce Professional Practice Test

CCWP - Certified Contingent Workforce Professional Practice Test

CCWP Worker Classification & Independent Contractor Compliance 2