Make-a-Bed and Unemployements Scandal

Furniture manufacturing and delivery company Make-a-Bed

Make-a-Bed wants to streamline and unify its production process in order to increase both its efficacy and profit margin. In light of this, the business chose to hire John, an engineer who claimed on his resume to have experience carrying out such a project. There is a provision in the agreement that John and Make-a-Bed reached that limits the number of hours John can bill each week to 20. The billable rate is not increased despite John's growing dedication to the company's restructuring. John has to pay more and more for travel as a result, and he is not compensated.

After a year has passed

John has not made any formal recommendations, and as such, the company decides to elicit the help of a professional consulting company. Consequently, John lays claim to unemployment benefits, which is denied, to wit he appeals and a hearing is held.

Analysis

As per the 2017 version of the IRS Publication 15A, Section Two, a person is regarded as either an employee or a private contractor based on the IRS 11-Factor (Common-Law) test. Joel behavior was controlled by the company, and the firm did not provide him any training. The work was not relatively short, and the work entailed the submission of monthly reports by Joel to management. It is worth noting that Joel was paid on a monthly basis through a check that was automatically dispensed upon the regular company payroll. Consequently, neither Joel nor Make-a-Bed Furniture company would incur liability in the event of termination of the contract, which is indicative of an employee-employer relationship.

Conclusion

Most of the answers arrived at from the common law test were indicative of an employee type of relationship as opposed to that described by an independent contractor. It is evident from the fact that Joel was subject to such terms as regular payroll, the setting of clear rules for working and mandatory monthly reporting, that Joel was treated more as an employee by Make-a-Bed Furniture Company than as an independent contractor.