Utah Independent Contractors laws & HR compliance analysis

Utah Independent Contractors: What you need to know

Whether a worker is an “employee” or an “independent contractor” is critical when it comes to such important issues as pension eligibility, workers' compensation coverage, wage and hour law, and many other matters. In some situations, federal law will govern, but the question is most often resolved by looking to state law, particularly in areas such as unemployment tax liability, workers' compensation, and state wage and hour requirements.
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An “independent contractor” is defined as any person engaged in the performance of any work for another who, while so engaged, is (1) independent of the employer in all that pertains to the execution of the work; (2) not subject to the routine rule or control of the employer; (3) engaged only in the performance of a definite job or piece of work; and (4) subordinate to the employer only in effecting a result in accordance with the employer’s design (Utah Code Sec. 34A-2-103).
The Utah Supreme Court has ruled that when determining whether a worker acted as an employee as opposed to an independent contractor for purposes of the Workers' Compensation Act, the focus is on whether the employer had the right to control the worker. Regardless of how the parties intended to structure their relationship, a worker is considered to have been an employee if the employer had the right to control how the worker executed the work. The court has consistently held that it is the right to control which is determinative and that the degree of control actually asserted is not important. Thus, an employee is one who is hired and paid a salary, a wage, or at a fixed rate, to perform the employer's work as directed by the employer, and who is ...

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