Compensation Final_Chapter 13

Economic reality test

To determine whether employees are financially dependent, employers must first apply the economic reality test. Focuses on whether workers are financially dependent on the employer. E.g., Can the worker work be employed by other employers? Is the work relationship for a limited duration Does the worker have a substantial investment in work facilities and equipment? If the answer is no, they're most likely an employee

Average cost of health insurance to companies for all private sector workers

Employers spent an average of $467 per employee per month for life, health, and disability insurance

% of employees with access to employer-sponsored health insurance programs

- 86% of all full-time private sector employees had access - 24% of part-time employees has access

Independent Contractors, Freelancers, and Consultants

- In the exercise of an independent employment, contracts to do a piece of work according to his own methods and is subject to his employer's only as to the end product or final result of his work. - Establish working relationships directly with companies on their own rather than through temp agencies. Independent contractors test: - Common law: Developed by judges through court proceedings that decide individual cases. Main focus is right to control the employee Involves three parts: * Behavioral: Does the company control or have the right to control what worker does and how she does it? * Financial: Are business aspects (e.g., who provides tools, how worker is paid) of job controlled by the payer? * Type of relationship: Are there written contracts or employee type benefits (i.e., pension plan, insurance, vacation pay)? Will the relationship continue and is the work performed a key aspect of the business?

Temporary (on-call) Employees

- Often referred to as "temps" are typically hired to cover for absent employees (e.g. maternity leave) or for a seasonal work. -typically hired through a staffing agency (15 to 30% commissions are common) -Full or part-time -typically less than one year -Legally employed by staffing firm

Part-Time Employees

- defined as part time workers who have less than 35 hours per week. - Voluntary: Choose to work fewer than 35 hours - Involuntary: Work fewer than 35 hours because they are unable to obtain full-time employment.

Types of contingent workers

1. part-time employees 2. temporary and on-call employees 3. leased employee arrangements 4. independent contractors, freelancers, and consultants

% of contingent and flextime employees in the U.S. civilian labor force

27.5 percent of the U.S. civilian labor workforce

Leased Employee Arrangment

Employ qualified individuals and place them in client companies on a long-term basis.

# of hours worked to be considered full-time under ObamaCare

Employees who work at least 30 hours per week or whose service hours equal at least 130 hours a month for more than 120 days in a year are considered full-time.