PayInOne：Misclassification Analyzer

Misclassification Analyzer

Employee or Contractor？

Contractor misclassification refers to the wrongful categorization of full-time employees as independent contractor, resulting in these employees losing out on rightful benefits and protections in the workplace.
This practice is considered a violation of labor laws worldwide and can result in fines or penalties.
Many employers, not familiar with relevant employment laws and regulations, unintentionally misclassify employees as temporary workers, leading to unnecessary risk.
Our Misclassification Analyzer helps you to understand how your employees are classified and makes sure they're categorized correctly to avoid the risk of misclassification.

1/11

How much control does the company have over the individual's work schedule and methods?

PayInOne Insight

Contractors should be able to choose their work hours, location, and methods, as long as they fulfill their contract obligations. Avoiding excessive supervision is crucial, as closely monitoring the individual's activities may lead to misclassification concerns. Granting individuals autonomy to work independently helps maintain their status as independent contractors.

The individual has the freedom to set their own work hours, breaks, and time off. The contractor has full control over how to provide the services, with minimal oversight
The individual is required to follow the company's set work hours and seek approval for time off. An internal manager will supervise the contractor's work on a daily basis

2/11

Is the individual closely associated with your organization?

PayInOne Insight

An individual is likely to be closely associated with your organization if:
- they report to someone within the company or have employees reporting to them;
- they use company-related contact information such as email addresses, phone numbers, or business cards;
- they participate in regular staff meetings, company events.

3/11

Will the individual receive comparable benefits to those offered to your employees?

PayInOne Insight

Examples may include healthcare insurance, retirement plans, stock options, allowances, and other perks.

4/11

Will the individual play a significant role in achieving the primary objectives of your business?

Example of contributing to the main purpose of business: An individual designing a logo for a graphic design company directly contributes to the main purpose of the business.
Example of not contributing to the main purpose of business: An individual designing a logo for a chocolate company does not directly contribute to the main purpose of the business.

PayInOne Insight

If you're uncertain about the extent of the individual's contribution to your business's main objectives, consider how essential their work is to producing your company's goods or delivering core services. Reflect on whether your business could operate effectively without the individual's involvement. If the individual's work is vital to your business operations, please respond "yes."

5/11

Is the individual required to perform the work personally?

PayInOne Insight

Please respond "yes" if the individual must personally perform the work, or "no" if they are allowed to assign tasks to their own employees or subcontractors. Individuals who are obligated to personally carry out the work and cannot delegate it to others are more likely to be classified as your employees.

6/11

Is the individual permitted to work for other companies besides yours?

PayInOne Insight

Restricting the individual from working for other clients may suggest a potential employment relationship with them. The greater the individual's autonomy in determining how and by whom work is performed, the less likely they are to be considered an employee. Answer "yes" if the individual is allowed to work for other clients. Answer "no" if the individual is unable or unwilling to work for other clients while providing services to you.

7/11

Who is responsible for providing equipment and covering ongoing expenses related to the services?

Company
Individual
The company provides the necessary equipment, but the contractor is responsible for day-to-day expenses associated with service delivery

8/11

How long is the individual's commitment expected to last?

The individual is committed on an ongoing basis
The individual is hired for a specific task or project, with a maximum duration of 12 months

9/11

Does the company regularly provide the individual with training or guidance sessions to improve their job performance?

10/11

How many hours per week will the individual devote to your company's projects?

PayInOne Insight

Individuals who work full-time or dedicate a substantial portion of their time to providing services for your organization, especially over an extended period, are more likely to be classified as employees rather than independent contractors.

up to 10 hours per week
10 - 30 hours per week
more than 30 hours per week

11/11

Do any restrictive agreements exist (e.g., non-solicitation, non-compete clauses, etc.)?