Question

Dalia worked on a contract basis as an auto mechanic for the clients of an auto repair shop. Whenever there was too much work for the employees of the shop, Dalia would receive a call and be assigned by the shop to do specific repairs on a particular vehicle.

Dalia’s specialty was rebuilding engines and the firm would often contact her to handle complex breakdowns for which they did not have sufficient time, since she worked much faster than the other four mechanics it had on staff. When the job was completed, she was paid a commission for her work based on the amount charged to that client by the auto shop. This commission was established in advance in the contract Dalia was offered when she accepted the position.

During the time she was working, Dalia was paid weekly, was free to use the shop’s garage, and also could use whatever equipment and supplies were necessary to complete the job. In order to ensure a consistent quality among all of its workers, as well as to be sure that it complied with all regulations that might govern the job, the firm’s head mechanic would check the car before the client was called to pick up the vehicle. This process ensured that clients saw all of the shop’s workers and contractors as equivalent quality.

Dalia is laid off in the middle of a job and she files for unemployment compensation. The shop defends the claim, arguing that she was not an employee.

Was Dalia an employee or an independent contractor? Explain.

Answer 1

Dalia was an independent contractor, not an employee, because it is not mentioned in the above stated case that Dalia received any employee-type benefits (such as insurance, pension plan, vacation pay, or sick pay) from the shop. And it is also mentioned in the case that after Dalia does her work, the head mechanic check the vehicle before giving it to the client. A independent contractor is likely to be working with the organization because of their expertise in specific area, like Dalia has in rebuilding engines. As it is also not mentioned in the case that, she was invited by the company in social events and receive all company’s internal communication. From these above mentioned points it is clear that Dalia was a independent contractor, instead of an employee.