California Code of Regulations › Title 22 - Social Security › Division 1 - Employment Development Department › Subdivision 1 - Director of Employment Development › Division 2.5 - WITHHOLDING TAX ON WAGES › Chapter 1 - GENERAL PROVISIONS › Table - Table of Determination Factors - Product Demonstrators

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
EXAMPLES
								  OF:
FACTORS
EMPLOYEE
INDEPENDENT
								  CONTRACTOR
WEIGHT
(c)
EXTENT OF
								CONTROL
( 1)
Policies or Rules of
								Conduct
Set by principal or retail establishment and followed by
								demonstrator.
Requirement that product demonstrators follow safety and
								security rules in store does not infer employment.
The factors of
								policy setting, procedures, instructions, supervision, and review carry great
								weight. The right of the principal or principal's agent to direct and control
								the services performed, even as to the details
( 2)
Procedures in Product Demonstrating or
								Marketing
Established by principal or agent and followed by
								demonstrator.
Demonstrator establishes procedures of work.
of
								the work, is the primary test. If that right exists, whether or not exercised,
								an employment relationship exists.
( 3)
Instructions for Conduct of
								Demonstration
Instructions given by principal or agent to demonstrator
								regarding site within store, customer relationships, dress code, dates, hours,
								or product.
Demonstrator uses "professional" judgment to choose site to
								maximize sales.
To the extent that the principal, or his or her agent,
								exercises control over the services through rules, procedures, supervision,
								review of work, etc., it is evidence that the principal has the right to
								control the services,
( 4)
Supervision on the
								Job
Demonstrator subject to supervision from store personnel and/or
								demonstration company personnel ("coordinators").
Details of work not
								supervised.
and that this right to control is complete and
								authoritative. This alone will create an employer-employee relationship.
( 5)
Review of Work
Principal or
								agent reviews the performance of the demonstrator as to how the demonstrator
								conducted himself or herself on the job.
No reviews of work processes
								or behavior.
( 6)
Training
Training provided by
								principal. Attendance is expected. Orientation and/or ongoing new product
								training. Training on sales pitch. Demonstrator paid for time at
								training.
Attendance at training is not required. Demonstrators are not
								paid for time at training. Demonstrators who do not attend specific product
								training are allowed equal opportunity to promote those
								products.
Training given by principal that includes instructions about
								how to do the work, e.g., dress code, product presentation, sales pitch,
								customer relations, infers that principal or agent has the right to control
								services and carries high weight.
( 7)
Meetings
Demonstrator expected
								to attend. Demonstrator's time is paid for. Meetings discuss products,
								appearance, and conduct.
Attendance not mandatory and non-attendance is
								viewed without negative consequence. Time at meetings is not paid for or
								meetings are not held.
The act of holding informational meetings, by
								itself, is not a strong indication of employment. Like training, if the intent
								and conduct of the meeting conveys rules, procedures, and instructions to do
								the work, it infers the demonstrators are not in control of services and not
								self-employed, and carries high weight.
( 8)
Reports
Reports are required
								regarding activities, e.g., number of demonstrations, number of people who came
								by, amount of product demonstrated, hours worked, inventories, customer
								reactions.
No reports required.
Reporting requirements can be
								viewed as an extension of the factor "review of work" and would be given medium
								to high weight depending on the purpose and content of the reports (verbal or
								written). Reports that are used to monitor demonstrator's performance are
								considered principal controls. Reports related only to end results are not an
								indication of employment or independence.
( 9)
Work Schedules
Set by
								principal, principal's agent, or store management, e.g., dates, times, total
								hours, breaks, and lunch.
Set by demonstrator.
"When and where"
								the service is performed is considered an aspect of the "details of the work."
								These factors would be given medium to high weight. It tends to show
(10)
Location of Work
Principal, or
								its agent, product demonstrator company, or manufacturer makes arrangements,
								assigns demonstrator to store.
Demonstrator chooses store, makes
								arrange ments for demonstration
independence if the demonstrator
								controls these aspects, and accomplishes an end result for the principal by
								operating his or her own separate business.
(11)
Principal/Demonstrator
								Contract
Agreement between demonstrator and principal gives principal
								or principal's agent control over manner and means of work.
Agreement
								forbids principal and/or agent from directing worker as to details.
								Demonstrator is not subject to control of
Terminology used in a written
								agreement is not conclusive of the relationship, but is evidence of the
								relationship intended.
principal or agent.
Written agreements do
								not necessarily depict
(12)
Written Agreement Between Principal
								and Third Party
Principal acknowledges employment or right of control
								in agreement with client(s) or labor organization. Written
								Agreement:
Principal contract with third parties precludes exercise of
								control by principal or third party. No control of demonstrator is
the
								actual relationship. The actual practices of the parties in a relationship are
								more important than the wording of an agreement in making a determination.
* Asserts right of principal to
considered
								neutral. Written
direct manner and means
								of
Agreement:
An agreement in which principal expresses
work.
. Clearly shows intent to
								create
only an interest in an end result and
* Otherwise shows intent to
independent
								relationship.
abandons the right to control the details of
create employment
. Reserves the
								demonstrator's
the work (manner and means) is evidence
* Provides detailed rules for
right to
								control how work is
of independence.
conduct or performance that
done.
principal or principal's agent shall enforce on
								demonstrator.
Demonstrator must operate in manner described in
								agreement.
An agreement not followed would have little weight in a
								determination.
(d)
TERMINATION
Both principal and
								agent have the right to terminate relationship at will without prior notice,
								and without any further contractual liability (except for work already
								performed or to end of shift or workday).
By agreement or practice,
								principal is required to pay for work not performed, if principal unilaterally
								terminates relationship other than for cause.
The right to terminate at
								will is strong evidence of employment. The right to terminate conveys an
								inherent power of the principal over the demonstrator. With this right, the
								principal can demand many things of the demonstrator, and the demonstrator,
								fearing fiscal repercussions, would be obliged to follow such demands.
(e)
ENGAGEMENT IN A DISTINCT
								BUSINESS
Demonstrator does not operate own
								business.
Demonstrator operates an independent demonstration
								business.
If the demonstrator is in a separate business, distinct from
								that of the principal, and the
* Services performed are regular part of
								principal's business.
. Contracts with distributors and retail
								establishments.
services in question are performed in the furtherance
								of that business, high weight
* Demonstrator does not offer
. Has
								business license where
would be given toward independence.
services to distributor or
								retail
required.
Medium weight is given to evidence
establishments as a
. Has phone directory
								listing.
showing the demonstrator is in a
separate business.
.
								Advertises
distinct occupation, which would also
* Demonstrator does not
. Registered with
								government
point to independence.
promote business venture of
								his
agencies.
or her initiative.
Demonstrator may
								engage
* Principal or agent may
								inhibit
substitutes without firm's
use of substitutes or require approval of
								substitutes.
approval and pays substitutes.
* Principal or agent pays substitutes.
(f)
CUSTOM IN INDUSTRY AND
								LOCATION
Work traditionally done by employees of manufacturer,
								distributor or store employees as part of sales activity. Work is usually done
								under direction of principal or principal's agent. Close supervision is not
								needed to control work.
Recognized experts or celebrities (guest
								appearance for special promotion).
This factor, by itself, is not
								controlling. This is because each determination must stand on its own facts
								regarding the principal's right to direct and control. Industry custom merely
								gives an inference or direction to the determination.
(g)
REQUIRED LEVEL OF SKILL OF
								DEMONSTRATOR
Little skill or experience required. No particular
								education needed. Anyone with sales talent could do the
								work.
Demonstrator has an expertise about the product other than
								demonstration.
Level of skill, by itself, generally does not weigh
								heavily. However, a high level of technical skill will weigh more heavily when
								combined with other factors such as separate and distinct business. A low level
								of technical skill weighs heavily in favor of employment, since as skill level
								declines the demonstrator has less room to exercise the discretion necessary to
								independence.
(h)
DURATION OF
								SERVICES
Demonstrator services are on a continuous basis that
								are:
Short durations and not recurring.
This factor, by itself,
								is not controlling. It tends to reflect whether a person is employed
* Recurring in nature.
or self-employed.
								Contractors
* At regular intervals at regular
								times.
usually perform work on a job basis for shorter and for
								pre-designated
* At irregular intervals.
periods of time.
								Employment is usually of open-ended duration.
(i)
WHETHER PRINCIPAL OR WORKER SUPPLIES
								INSTRUMENTALITIES, TOOLS, AND PLACE OF WORK
Provided or paid for by
								principal, e.g., trade name, office, facilities, store space, tables, counters,
								appliances, booths, advertising, merchandise, inventory, or
								communication.
Provided or paid for by demonstrator without
								reimbursement. Demonstrator provides tools or equipment with significant
								financial investment.
The weight given to whether the principal or
								demonstrator supplies the instrumentalities or tools will vary depending on the
								value of such items. As the value of the instrumentalities and tools increases
								heavier weight is given to this factor. The place
Hand tools commonly used by demonstrator (i.e.,
								card tables, skillets, mixers, portable ovens, etc.) or an automobile for
								transportation do not infer employment or independence.
of work is
								always provided by the principal or its agent, so this factor is given little
								weight in demonstrator determinations.
(j)
METHOD OF PAYMENT
Based on time
								worked. Payment
Payment based on end result:
This factor, by
								itself, as with written
by shift, hour, orpiece rate. Payment at regular
								intervals
. Commission based on sales volume,
agreements, is
								not controlling. It is only an indication of the type of relationship.
and in regular amounts. Payment by salary. Benefits
								provided.
. Commission based on volume of product
								demonstrated.
This is because many times it is difficult to determine
								if payment is by the
Compensation set by principal. Expenses reimbursed.
								Billings and collections by principal.
No benefits provided.
								Demonstrator purchases product demonstrated and/or sold, and compensation based
								on gross sales less cost of merchandise.
job or commission versus some
								method based on time worked or a salary.
(k)
BELIEF OF PARTIES
. Both the
								parties believe the relationship is employment.
All parties agree that
								relationship is one of independence.
This factor, by itself, is not
								controlling. The belief of parties only infers a relationship intended.
(
l
)
PART OF
								REGULAR BUSINESS OF PRINCIPAL
Services are an integral or normal part
								of the principal or agent's regular business activities. Activities are central
								to producing the products or delivering the services provided by the
								business.
Demonstrator assures entrepreneurial risk and investment.
								Services only supportive of business activity/purpose and are not integral part
								of business.
This factor is given medium to high weight. The
								presumption is that if the service is an integral part (regular/normal/central)
								of the principal's business, the principal, by business necessity, needs to
								maintain control over the service.