Ch 36 Broker-Agent Relationship

Policy and Procedures Manual Tops

-ADVERTISING -BROKER RESPONSIBILITIES -CODE OF ETHICS -COMMISSION POLICY ON ASSOCIATE'S PERSONAL PURCHASES/SALES -CO-OPERATIVE SALES WITH OTHER REAL ESTATE COMPANIES -DESK SPACE -DISCRIMINATORY PRACTICES -DRESS AND ATTIRE -ENTERTAINING CUSTOMERS AND CLIENTS -ESCROW MONIES -FLOOR TIME -INTER-OFFICE RESPONSIBILITIES AND COOPERATION -KEYS -LISTINGS - WHAT IS EXPECTED -LISTING POLICIES AND PROCEDURES -OFFERS AND COUNTEROFFERS -OPEN HOUSES -PROSPECTING POLICIES AND PROCEDURES -REFERRAL FEES -SAFETY POLICY-SALES CONTRACTS - WHAT IS EXPECTED -SALES MEETINGS AND INSPECTION TOURS -SALESPERSON COMMISSION POLICY -SALESPERSON EXPENSES -SALESPERSON DISPUTES -SETTLEMENT AND SETTLEMENT COSTS -SHOWING PROPERTY -TELEPHONE/TELEGRAM/FAX /EMAIL ACCEPTANCE OF A CONTRACT -TERMINATION -USE OF COMPANY RESOURCES

Independent Contractor Status

A broker can tell the independent contractor what to do, but not must pay his or her own income tax, self-employment taxes, Social Security tax and Medicare tax. In addition, the salesperson cannot receive anything from the broker that would make it look like he or she is an employee, such as health insurance, paid sick days or a pension plan. Note: A broker may carry errors and omissions insurance on all of his or her licensees, regardless of their status as employees or independent contractors. The broker may pay the cost or require the licensees to pay it. how to do it. In this case, the broker cannot dictate working hours or require the salesperson to have office duty at specific times or attend meetings. Salespersons working as independent contractors are paid by the job (commission rather than an hourly or weekly salary), they must usually pay their own expenses and they must provide their own tools. The broker does not withhold anything from the commission he or she pays the independent contractor. If the licensee makes more than $600, the broker must file an IRS Form 1099-MISC for that licensee to report how much he or she earned for the year.

Transaction records

According to the real estate license law in many states, the brokerage firm is responsible for keeping a file on every real estate transaction. The file must contain all agreements, contracts, documents, leases, closing statements and correspondence for each real estate or business opportunity transaction. For sales transactions, the file must also contain a copy of the earnest money agreement, a copy of the final settlement statement, and any addenda related to the accounting or disposition of client funds.

DESK SPACE

Are desks and/or cubicles to be shared? Are computers to be shared? What are the procedures to be followed in creating a compatible sharing situation?

SETTLEMENT AND SETTLEMENT COSTS

Are there brokerage-directed forms to use with the sellers and buyers to ease them through the escrow process? Does the broker use the lender's Good Faith Estimate form or does the broker determine the figures?

ENTERTAINING CUSTOMERS AND CLIENTS

Are there specific policies regarding how customers and/or clients should be entertained? Even if the licensee is paying, are there limitations on where a customer/client can be taken; i.e., a nightclub, a sports bar, etc.

SHOWING PROPERTY

Are there specific procedures for the brokers to use when showing property? What is the policy for making appointments, keeping appointments, and breaking appointments (if necessary)? How can the broker be safe, and how can the broker protect the homeowner's possessions while showing the property?

Tax records and expense records

As independent contractors, these records are particularly important as documentation for the licensee's tax return. Also, depending on the written agreement the licensee has with the broker, he or she may need specific expense records and receipts for reimbursement of some of those expenses.

Recommended Forms

As we mentioned on a previous screen, the broker must file yearly the IRS Form 1099-MISC for any independent contractor licensee who earns more than $600. The broker should provide a copy of this form, which reports the licensee's total earnings for the year, to the licensee for his or her records. The licensee should track his or her earnings carefully and make sure that his or her record of earnings matches what the broker has submitted to the IRS. The licensee should also be vigilant in keeping records of expenses, so that he or she will have complete and accurate information when it comes time to file the federal and state income tax returns.

Some of the responsibilities that brokers have to their affiliated licensees may include the following:

Assure that all real estate brokerage services in which the broker participates are in accordance with the license law and rules. Maintain, implement, and follow a written policy that addresses the levels of supervision of all members of the firm. Assure that the licensee has a copy of the firm's policy and procedures manual. Provide access to all the firm's listings and marketing data. Review all brokerage agreements, both listing agreements and purchase offers, which involve any newly-licensed affiliated licensee. (It's probably a good idea for the broker to conduct these reviews for at least a year.) Ensure that all persons performing real estate brokerage services on behalf of the firm are appropriately licensed. Provide the level of office support that was agreed upon and written into the employment contract. Ensure that affiliated licensees submit their transaction documents to the broker in a timely manner. Provide all training that was agreed upon when the licensee was hired.

Responsibilities of affiliated licensees to their broker may include the following:

Assure that all real estate brokerage services in which the licensee participates are in accordance with the license law and rules. Remain knowledgeable about the license laws and rules. Follow the written policies outlined in the policy and procedures manual. Seek advice regarding any aspects of the firm's policies that are not clear to the licensee. Work to promote and sell the broker's listings. Work to procure new listings for the firm. Assure that all fiduciary duties owed to the broker's clients are fulfilled. Seek advice and counsel from the broker when questions arise that the licensee cannot answer. Be appropriately licensed. Follow licensing laws and rules regarding the handling of client's funds and property. Deliver all transaction documents to the broker in a timely manner. Assure that all advertising written by the licensee is proper and legal. Maintain all insurance policies required by the broker. Act in an ethical manner as required by the broker and the real estate trade organizations.

Due to the potential for broker responsibility for a licensee's actions, what do many brokers require their licensees to carry?

Automobile liability insurance in high amounts, naming the broker as an insured on the policy Errors and omissions insurance, covering the broker and salespersons for negligent acts

Because brokers could be held responsible for any wrongful acts performed by a salesperson they employ, many brokers require that licensees carry:

Automobile liability insurance in high amounts, naming the broker as an insured on the policy Errors and omissions insurance, covering the broker and salespersons for negligent acts (but not intentional acts)

What are the three common-law categories that determine the level of control an employer has?

Behavioral Financial Type of relationship

USE OF COMPANY RESOURCES

Besides using office space, desks, computers, telephones, office supplies, use of a receptionist and/or secretary, what other office resources are included? Does the broker pay for copies? What costs can a licensee or staff employee expect to pay?

COMMISSION POLICY ON ASSOCIATE'S PERSONAL PURCHASES/SALES

Can the sales associate buy and sell properties for his or her own investment portfolio? Will such transactions need to be run through the brokerage? What is the responsibility of the broker in this situation and what is the liability of the broker? Are personal investment opportunities allowed or not?

Jack sells one of his own $225,000 listings for $220,000. The commission is 7%. Jack has an 80% commission split with his broker. What is Jack's share of the commission? What is his broker's share?

Commission = $15,400 ($220,000 x .07) Jack's share = $12,320 ($15,400 x .80) Broker's share = $3,080 ($15,400 - $12.320)

SALESPERSON COMMISSION POLICY

Even though the specific commission split with each individual agent is outlined in his or her Business Agreement, the office policy manual will explain the commission procedure for the brokerage.

Substance Over Form

Even with a written independent contractor agreement in place, both parties must recognize that the broker still has a duty to supervise his or her licensees. This duty is first and foremost in their agreement.

Common Law Rules

Facts that provide verification of the level of control and independence fall into three categories: Behavioral - Does the company control or have the right to control what the worker does and how the worker does his or her job? Financial - Are the business aspects of the worker's job controlled by the employer? (These include things like how a worker is paid, whether or not the employer reimburses expenses, or who provides tools/supplies.) Type of Relationship - Are there written contracts or employee-type benefits, such as a pension plan, health insurance, or sick pay? Will the relationship continue and is the work performed a key aspect of the business?

When paying employees, the broker must withhold the following from the salesperson's wages:

Federal income tax State income tax Social Security tax Medicare tax The broker would also be responsible for paying federal and state unemployment taxes, workers' compensation and disability insurance. And there are also quarterly and annual government reports to file. Most real estate assistants, both licensed and unlicensed, are considered employees for income tax purposes.

IRS Code Section 3508

Federal tax laws allow real estate agents to be classified as independent contractors. In order to qualify, the IRS requires what's called the safe harbor test to establish that a person is indeed an independent contractor.

REFERRAL FEES

How are referrals dealt with?

Balance

However, both licensees and brokers must realize that different salespersons will require different levels of supervision. In most cases, a licensee with experience will not need the level of supervision that a new licensee will need. So the broker will have to exercise some degree of judgment when deciding how much supervision to provide to a particular licensee.

Employee Status

If a broker hires a salesperson as an employee, he or she can require the salesperson to follow rules regarding such things as: Working hours Office duty Meetings Dress code The broker can require an employee to perform his or her work in a certain order or work at a specified location. usually have their expenses paid by their broker and the broker usually supplies whatever tools the employee needs to conduct business. Employees could also receive health insurance or profit-sharing benefits from the broker.

What is the compensation for a licensee who sells one of his or her own listings?

If a licensee lists and sells a property, he or she will receive a share of both the listing and selling side commissions.

fidelity bond

If a licensee working for a broker is a property manager having access to the money of others, the broker may get a fidelity bond to protect himself or herself from any embezzlement by such a licensee.

Consequences of Non-Compliance

If as a result of an IRS audit a salesperson is concluded to be an employee, the broker will be liable for state and federal unemployment insurance premiums, workers compensation and disability insurance. The broker will also have to withhold federal and Kentucky taxes, including Social Security taxes. In addition, the broker could incur stiff tax penalties as a result of the incorrect classification. For the licensee, employee status means that he or she cannot claim the self-employment deductions that would otherwise be allowed on his or her income taxes. In addition, the licensee will lose that part of the commission that the broker will have to withhold to cover the Kentucky and federal income taxes. Maintaining independent contractor status can create a predicament for some brokers. It limits the control they have over their licensees. As we said, if the broker exercises too much control, it can look more like employee status for the licensee.

CO-OPERATIVE SALES WITH OTHER REAL ESTATE COMPANIES

If the brokerages are members of a Multiple Listing Service, usually cooperating brokerage fees are spelled out in the MLS rules. But if not, those policies will be addressed here. Also the policy in dealing with out-of-state brokerages should be defined.

Commission Splits

In most cases a real estate transaction is completed by cooperating brokers. Each broker will receive an agreed upon share (percentage) of the compensation. These shares can be referred to as the listing side commission and the selling side commission. A licensee who lists a home for sale will receive a share of the employing broker's commission on the listing side. This share will be based on the compensation agreement this agent has with the employing broker. A licensee who sells a listing will receive a share of the employing broker's commission on the selling side. This share will also be based on the compensation agreement this agent has with the employing broker. If a licensee lists and sells a property, he or she will receive a share of both the listing and selling side commissions.

Commission Split Example 2

In this scenario, Jim sells one of his own listings. Jim listed a home for $250,000 and it sold for $240,000. The owner negotiated a 5% commission on this listing. Sale Price: $240,000 Commission at 5%: $12,000 ($240,000 x .05) Brokerage share: $12,000 Jim's share: $7,200 ($12,000 x .60) John's share: $4,800 ($12,000 - $7,200) Let's try another scenario.

DRESS AND ATTIRE

Is attire in the office to be professional at all times or is casual attire permitted? What constitutes professional attire? Is professional attire required at all times when brokers are with clients?

OFFERS AND COUNTEROFFERS

Is it the policy within this brokerage for the agents to present their own offers directly to the sellers, or is it standard to fax or email the offer to the other listing brokerage and let the listing agent present the offer?

workers' compensation coverage

It also seems that brokers are not protected from any injury claims that may be made by any of their independent contractors, so it would be wise for brokers to carry workers' compensation coverage for everyone who works for them.

Commission Split Example 1

Jim works for Gaslight Realty. His compensation agreement with his broker John states that he will receive 60% of the commission on any transaction he negotiates. Broker John has a co-brokerage split of 50% with the other agencies in town. Jim lists a home that sells for $125,000. The commission rate is set at 6%. Let's calculate what John and Jim will receive from this transaction if the home was sold by an agent from another firm. Sale Price: $125,000 Commission at 6%: $7,500 ($125,000 x .06) Brokerage share: $3,750 ($7,500 ÷ 2) Jim's share: $2,250 ($3,750 x .60) John's share: $1,500 ($3,750 - $2,250) Let's do another example with Jim and John.

DISCRIMINATORY PRACTICES

Licensees and staff should understand that they must not inquire about, respond to or facilitate inquiries about, or make any disclosures which indicate any preference, limitation or discrimination based on race, color, religion, sex, national origin, ancestry, familial status, or handicap. Handicap includes a person who has, had, or may have, AIDS, or an HIV infection or illness.

What kind of training is best for small firms?

One-on-one, on-the-job training

Depending on the size of the office, training can take various forms:

One-on-one, on-the-job training - best for small firms Training sessions periodically integrated into sales meetings - often used in medium-sized offices Organized classroom training - typically done by multiple office companies, franchises or small independent firms combining to offer training It is important for a broker to include information about Kentucky licensing laws, agency duties, discrimination laws and antitrust laws in the training provided.

Here is a list of important things to look for when choosing a broker/firm.

Quality training programs are available in-house and locally. The broker encourages and supports training. The broker provides a mentor program and/or office assistance for the licensees. The firm has a large selection of books, audios, videos and CDs on hand for licensee use. The office is dedicated to the licensee's desired specialty area. The firm employs a number of successful agents. The agents have a long history with the firm. The firm feels like a "good fit."

Written Employment Agreements

Regardless of a licensee's status as employee or independent contractor, the broker mustenter into a written agreement with each affiliated licensee. The employing broker must give a copy of the employment agreement, including any modifications, to every employee and independent contractor. It would be wise for a broker to have a standardized contract that has been reviewed by an attorney to be sure it is in compliance with federal law.

The Written Employment Agreement must be dated and signed by the parties. It must include, at the minimum, the employment or independent contractor relationship terms, including but not limited to:

Supervision Duties Compensation Duration (this term, as used here, is not meant to indicate a specific termination date, but to allow the parties to negotiate the term of the agreement, whether "at will" or a specific length of time) Termination (how the agreement is renewed or terminated, and that these provisions be included in the agreement)

What five topics must be included in every written agreement with an employee or independent contractor?

Supervision Duties Duration Termination Compensation

It's important for every licensee to maintain his or her own business records. Some of the records are required by license law; others just make sense to keep. Basically a licensee should keep two types of records:

Tax records and expense records Transaction records

What is a 100 percent commission plan?

The agent pays a monthly fee to the company to cover the costs of things like office space, telephones, office equipment and supervision. In return, the agent receives 100% of the commission from any sales he or she negotiates.

How can a broker choose to pay his or her licensees?

The broker can choose to pay the salesperson a salary or a percentage share of the commission from the transaction.

Salesperson Compensation

The broker can choose to pay the salesperson a salary or a percentage share of the commission from the transaction. Many companies have a payment plan that is "graduated." In this type of program, an agent may start out at a lower percentage payment, but then graduate to higher percentage rates as his or her production increases. Other companies have a 100% commission plan. In this situation, the agent pays a monthly fee to the company to cover the costs of things like office space, telephones, office equipment and supervision. In return, the agent receives 100% of the commission from any sales he or she negotiates. Most often in these programs, the agent is responsible for the costs of advertising and promotion.

What are the consequences to the broker if an IRS audit reveals that a contractor is actually an employee?

The broker will be liable for state and federal unemployment insurance premiums, workers compensation and disability insurance. The broker will also have to withhold federal and state taxes, including Social Security taxes. In addition, the broker could incur stiff tax penalties as a result of the incorrect classification.

What is the main difference between an employee and an independent contractor?

The main difference between the two is an issue of control, as established by income tax laws.

What are the conditions of the IRS safe harbor test?

The person must be a properly licensed real estate agent. Gross income from all output must be based on production and not on hours worked. A written agreement must exist between the independent contractor and the broker stating that the contractor will not be treated as an employee for income tax purposes.

The three conditions of the safe harbor test are:

The person must be a properly licensed real estate agent. Gross income, including that which results from sales and all other output (including the performance of services), must be based on production and not on hours worked. A written agreement must exist between the independent contractor and the broker which outlines the services to be performed by the contractor and states that the contractor will not be treated as an employee for income tax purposes.

Policy and Procedures Manual

The purpose of a policy and procedures manual is to make sure that all members of the brokerage company understand the broker's philosophy. All company policies must comply with all laws, including license law. The law does not prescribe manual contents but does suggest several topics.

Broker Supervision

The way the IRS treats a salesperson - as either an employee or an independent contractor - applies to the issues of income tax and withholding obligations. It has nothing to do with the broker's liability for any wrongful acts performed by the licensee. Kentucky requires that brokers supervise all their salespeople, regardless of their income tax classification. Even though a salesperson may be classified as an independent contractor, the broker is still responsible for the licensee's professional actions.

Why should an independent contractor keep expense records?

These records are particularly important as documentation for the licensee's tax return. Also, depending on the written agreement the licensee has with the broker, he or she may need specific expense records and receipts for reimbursement of some of those expenses.

Commission Split Example 3

This one is a bit more complicated. This time Jim listed a home for $160,000 and it was sold for $150,000 by another agent in the same agency. Sarah has a 75% commission split with broker John. The commission is 6% on this listing. Commission for each "side" is 50%. Sale Price: $150,000 Commission at 6%: $9,000 ($150,000 x .06) Brokerage share: $9,000 Listing side: $4,500 (50%) Selling side: $4,500 (50%) Listing side: Jim's share: $2,700 ($4,500 x .60) John's share: $1,800 ($4,500 - $2,700) Selling side: Sarah's share: $3,375 ($4,500 x .75) John's share: $1,125 ($4,500 - $3,375) John's total on the transaction: $2,925 ($1,800 + $1,125)

Commission Split Example 4

This one is a little different. It still involves Jim and John, but now we'll add another broker and her salesperson to the mix. Remember there's a 50% co-brokerage split. Gaslight Realty - Broker John and agent Jim (60% commission split) Hamilton Real Estate - Broker Anita and agent Tanya ( 50% commission split) This one is agent Tanya's listing of a $200,000 home Jim sold for $195,000. The commission on this listing is 6%. Sales Price: $195,000 Commission: $11,700 ($195,000 x .06) Listing side commission: $5,850 ($11,700 ÷ 2) Tanya's share: $2,925 ($5,850 ÷ 2)* Anita's share: $2,925 ($5,850 ÷ 2)* * Remember this broker has a 50% split with her agent Selling side commission: $5,850 ($11,700 ÷ 2) Jim's share: $3,510 ($5,850 x .60) John's share: $2,340 ($5,850 - $3,510)

What kind of training do new salespersons need?

Training in the management systems and philosophy of the brokerage company

TERMINATION

What are the actions that will precipitate termination with the company? What will happen to transactions that are in escrow?

BROKER RESPONSIBILITIES

What are the broker's obligations to the staff and licensees? If the managing broker's license becomes inactive, what are his or her obligations to the licensees? What are the procedures for ending the sponsorship of a licensee?

CODE OF ETHICS

What are the ethical standards recognized in the brokerage? How are staff and brokers expected to adhere to these standards? If the licensees are REALTOR® members, must they have had the NAR Code of Ethics training?

OPEN HOUSES

What are the procedures for licensees holding open houses? What are the rules regarding open house signs and directional signs? What are the safety policies regarding how to keep the licensees safe and how to protect the homeowners' possessions during an open house?

What types of information might the policy manual contain about open houses?

What are the procedures for licensees holding open houses? What are the rules regarding open house signs and directional signs? What are the safety policies regarding how to keep the licensees safe and how to protect the homeowners' possessions during an open house?

SALES CONTRACTS - WHAT IS EXPECTED

What are the procedures in place when a sale is made? How is the sale to be brought into the office? What are the procedures for: acceptance and ratification of offers, the deposit of earnest monies, holding of the documents, occupancy agreements, non-realty items, contingencies, alterations and changes, inspection of the property, procedures on forfeitures and returned deposits? Who maintains the transaction folders and the trust account?

ESCROW MONIES

What are the requirements for getting escrow monies to either the brokerage or the approved escrow depository (Title Company)? What forms of escrow monies does the brokerage allow; i.e., personal check, cashier's check, money market order, promissory note, etc.?

When deciding what firm would work best, licenses should ask these types of questions:

What are the start-up costs? Some brokers charge a monthly fee for a desk and a fee to have a telephone line. Who pays the expenses? Some expenses will probably be paid by the broker with the rest falling to the licensee. The licensee needs to know who will pay for which. These expenses include "For Sale" and "Open House" signs and flags, business cards, stationery, literature, brochures, newspaper ads, telephone charges, forms, trade magazines, membership in the local Chamber of Commerce yellow page ads, Internet websites and email addresses. What are the salesperson requirements? Most brokers expect their licensees to have a good car with adequate insurance that would cover any liability that could happen when showing property. Errors and omission insurance is also important and is usually paid by the licensee through the broker, but the broker could choose to provide it.

What are three important questions to ask when negotiating a contract? (See screens 11 and 12 for other correct answers.)

What are the start-up costs? Who pays the expenses? What is the commission schedule?

LISTINGS - WHAT IS EXPECTED

What are the types of listings taken within the brokerage (exclusive-right-to-sell, exclusive, open, other)? Does the firm accept third-party corporate relocation listings? How should listings be priced and what is the policy for how long a listing should be taken?

SAFETY POLICY

What is the established procedure for maintaining safety in the office place? What are the codes and procedures for keeping agents safe who are in the field?

TELEPHONE/TELEGRAM/FAX /EMAIL ACCEPTANCE OF A CONTRACT

What is the policy for accepting a contract via phone, telegram, fax or email?

SALES MEETINGS AND INSPECTION TOURS

What is the policy on sales meetings? When, where and how often are they to be held? Is attendance mandatory?

LISTING POLICIES AND PROCEDURES

What is the procedure for bringing the listing into the office? How is a listing entered into the MLS? What contracts or forms are to be used, how is the listing information to be verified, and what are the processing procedures? Is a home protection plan offered? How will the listing be serviced by the listing agent and the brokerage? What is the brokerage responsibility to the listing licensee regarding advertising, other marketing, etc.?

FLOOR TIME

What is the purpose of floor time, how is it to be scheduled, how long is it for? Can the independent contractor request floor time? What are the other specific rules expected of the salesperson during floor time? Does each brokerage listing require special informational training?

SALESPERSON EXPENSES

What is the salesperson expected to pay for (signs, business cards, entertaining, and advertising)?

KEYS

What procedures are in place for keeping keys safe in the office? What steps must staff and brokers follow in the distribution of keys and in getting them back?

INTER-OFFICE RESPONSIBILITIES AND COOPERATION

What responsibilities does each person in the office have to the other? What are the telephone procedures? When there are interoffice disputes, what is the procedure? Who makes the final decision on inter-office disputes? If someone feels there has been sexual harassment, to whom is that reported? What are the consequences for continued violations of the office rules?

Other questions to ask include:

What training and support is provided? Some companies start their licensees of with a week or so of training. Others have in-house training staff to teach licensees how to use their forms and/or provide training in closing techniques. Other firms have experienced licensees who mentor the new salespersons by answering their questions and accompanying them on appointments. What is the commission schedule? As we will discuss later in this chapter, firms have different methods of splitting the commissions. The licensee needs to know when and how the broker will pay commissions. Some brokers offer a bonus incentive that kicks in after a licensee earns a certain amount in commission. This greatly encourages higher productivity. Who answers the phone? This is an important issue in determining how to set priorities and budget time. If a licensee can answer the phone, he or she is receiving leads to potential clients. What are miscellaneous benefits? Some brokers provide incentives to successful licenses that allow them to attend educational seminars that are provided by various real estate boards. A broker may allow a licensee to purchase a personal residence without having to pay a listing or selling commission or at a significantly reduced commission.

PROSPECTING POLICIES AND PROCEDURES

What types of prospecting for clients are encouraged within the brokerage and what types are discouraged? What are the policies regarding general advertising; direct- mail, flyers; signs, flags and billboards; individual advertising programs; telephone solicitation and prospecting programs; expired listing prospecting; door-to-door neighborhood canvassing (farming), long distance telephone calls.

SALESPERSON DISPUTES

When two licensees get in a dispute over clients, commissions or general problems, what are the rules for mediation or binding arbitration (within the company)? Will there be money considerations (fines, etc.?) What could be the potential disciplinary actions?

ADVERTISING

Who writes the ads? Who places ads? Who pays for ads? What media is authorized for use in the brokerage? Is there training on telemarketing solicitation?

What types of information might the policy manual contain about advertising?

Who writes the ads? Who places ads? Who pays for ads? What media is authorized for use in the brokerage? Is there training on telemarketing solicitation?

independent contractor

is hired to perform certain acts, but the broker cannot control how the salesperson performs those acts.

employee

works under the supervision and control of the broker.