ComplianceToolsLibrary

Employee Classification Checker

Assess whether a worker should be classified as a W-2 employee or 1099 independent contractor.

⚠ Disclaimer: This tool is for informational purposes only and does not constitute legal advice. Consult a qualified attorney or HR professional for guidance specific to your situation.

Answer each question based on the actual working relationship — not just what a contract says. The IRS looks at three categories of evidence: Behavioral Control, Financial Control, and Type of Relationship.

Behavioral Control

Does the company control or have the right to control what the worker does and how the worker does their job?

This includes instructions on when/where to work, what tools to use, where to purchase supplies, and what order or sequence to follow.

Does the company provide training to the worker on how to do the job?

Employees are typically trained by the employer. Independent contractors use their own methods.

Does the company set the worker's schedule or hours of work?

Setting specific hours indicates an employment relationship. Independent contractors typically set their own schedules.

Is the worker required to perform services personally (vs. hiring substitutes)?

Requiring personal service suggests employment. Independent contractors can typically hire helpers or substitutes.

Financial Control

Does the company reimburse the worker's business expenses?

Employees are more likely to be reimbursed. Independent contractors typically bear their own expenses.

Does the company provide the tools, equipment, or supplies needed?

Providing tools/equipment indicates employment. Independent contractors typically invest in their own.

Is the worker paid a regular wage or salary (vs. per-project or commission)?

Regular payments (hourly, weekly, monthly) suggest employment. Payment per project is more characteristic of independent contractors.

Can the worker realize a profit or loss from the work?

Independent contractors can profit or lose money. Employees are typically guaranteed payment regardless.

Type of Relationship

Is there a written contract describing the worker as an employee with benefits?

While a contract alone doesn't determine status, employee benefits (insurance, pension, paid leave) indicate employment.

Is the work performed a key aspect of the company's regular business?

If the service is a core part of the business, an employment relationship is more likely.

Is the relationship expected to continue indefinitely (vs. for a specific project/period)?

Indefinite or ongoing relationships suggest employment. Project-based work is more typical of independent contractors.

Does the worker provide services to multiple unrelated companies at the same time?

Working for multiple clients simultaneously is characteristic of independent contractors.