Overview
Independent contractors are common to many industries. Within those industries, people sometimes believe workers to be independent contractors when they are not. For example, it is fairly common for some secretaries, clerks, managers, consultants, janitors, nurses, machine operators, and service providers who perform part-time, temporary, or probationary service to believe (or are led to believe) they are independent contractors when they are not.

It is important for you to be aware of all the information related to the independent contractor criteria. We encourage you to read this material as well as that from other agencies. There are differences in the independent contractor law as it is enforced by the various Oregon state agencies and the Federal Internal Revenue Service (IRS). Although there is a similarity in all five areas of law (direction and control of the worker), the most evident difference comes under ORS 670.600 where Employment, Revenue, and Construction law turn to a test regarding an independently established business. Workers' Compensation and Wage and Hour law must evaluate the worker status based on the common law tests surrounding the question of direction and control of the worker. In Workers' Compensation, there does not even have to be actual direction and control if someone has the right to direct and control another; then the worker is an employee.

Understanding the differences in law and assuring compliance in all areas is important to you and any business relationships you develop. Errors in business practices can be costly.


Definitions and commonly asked questions and answers: