The law defines "indepdent contractors" not by the label the small business owner puts on them, but on HOW they work. It is a fabulous idea to hire independent contractors when it makes sense - for instance, you may want to hire a bookkeeper, office cleaner or courier without bringing them on-board as an employee. However, you do not want to call your 9-5 secretary or your uniformed landscaping assistant an "independent contractor" if that is not what she is...

In the words of the IRS "If you have the right to control or direct not only what is to be done but also how it is to be done then your workers are most likely employees. If you can direct or control only the result of the work done, and not the means and methods of accomplishing the result, then your workers are probably independent contractors."

Key areas are training, instructions, benefits & reimbursement for expenses - the more a worker receives in any of these categories, the more likely they are an employee. The less they receive, the less they look like an employee.

For example, say you want someone to help deliver local packages for your business. If you tell your help when to show up, when to leave, ask them to wear a uniform or name badge, have a delivery order and certain procedures they need to follow, offer medical insuranc and pay for the gas, oil changes & so forth, you almost certainly will not be able to avoid the "employee" designation. On the other hand, if you hire a delivery person to pick up & deliver all your packages in their own vehicle, in whatever order they chose, with the only instruction that they are delivered the same day & compensate per delivery you likely have an independent contractor.

Still confused? Your help can always ask the IRS to make the call by filing an SS-8 form with the IRS.