We’ve written quite a bit about the new penalties for mischaracterizing employees as independent contractors. But we haven’t talked as much about how to draw the distinction. Partly that’s because different government agencies use different approaches. And some of it’s due to the fact that these can be very fact-specific determinations and it’s hard to discuss them in generalities.

In California, the Employment Development Department administers unemployment, state disability, and workers’ comp claims and collects employment-related taxes. They’ve put together this questionnaire (pdf) that includes three "significant questions," three additional questions, seven questions that address "additional factors," and a discussion of how to interpret the answers. While it’s not a perfect tool, it at least provides some insight on how one agency approaches the issue.

If you want to see other agencies’ approaches, here are the links for the Division of Labor Standards Enforcement (which enforces wage and hour laws) and the IRS (pdf) (which California’s Franchise Tax Board follows).