Independent Contractor Reclassification Coming

[Old_Mil]

"As Fox Business notes, the PRO Act also includes a provision that reclassifies many independent contractors as employees. That repeats the policy enacted by California’s Democrat-dominated legislature in 2019 in AB 5,..."

Check your contracts, taxes, and status before this passes.

Perhaps some California docs can chime in and let us know what happened after this. They were playing some strange word games in their recruiting out there, calling it "independent employee status" or some such BS to try and skirt the law but I haven't looked at it closely because I'd probably rather live and work in Syria than California. At any rate I can't imagine that the IRS would be amused by that when April 15th rolled around and you filed your 1040.

Mind you, I don't necessarily think this is a bad thing, reclassification as W2 employees with or without unionization may be the best chance we have of getting rid of CMGs.

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[GeneralVeers]

"As Fox Business notes, the PRO Act also includes a provision that reclassifies many independent contractors as employees. That repeats the policy enacted by California’s Democrat-dominated legislature in 2019 in AB 5,..."

Check your contracts, taxes, and status before this passes.

Perhaps some California docs can chime in and let us know what happened after this. They were playing some strange word games in their recruiting out there, calling it "independent employee status" or some such BS to try and skirt the law but I haven't looked at it closely because I'd probably rather live and work in Syria than California. At any rate I can't imagine that the IRS would be amused by that when April 15th rolled around and you filed your 1040.

Mind you, I don't necessarily think this is a bad thing, reclassification as W2 employees with or without unionization may be the best chance we have of getting rid of CMGs.

I can't see a big difference with classification in non-right-to-work states. Even as W2 I can be fired for no cause with 90 day notice.

 

[CliveStaples]

Unlikely to pass the Senate as-is, but I do think that if legislature like this comes to pass it will be business as usual with CMGs simply offering W2 positions with minimum benefits. Envision for instance already has many sites where they do this and many other sites where they use the standard 1099 fleet - I have no doubt that they'll find a way to keep the wheel turning.

If ER docs have really surrendered the model of private practice, they should be pushing for hospital-owned employee models, not big private equity.

 

[southerndoc]

The problem is that it's buried within another bill. That's how things like this frequently get through.

 

[namethatsmell]

If ER docs have really surrendered the model of private practice, they should be pushing for hospital-owned employee models, not big private equity.

Yes. My experiences working for a CMG vs hospital have been night and day. When considering pph, the hospital gigs often pay more...and with less stress, better benefits, and job security.

 

[dpmd]

"As Fox Business notes, the PRO Act also includes a provision that reclassifies many independent contractors as employees. That repeats the policy enacted by California’s Democrat-dominated legislature in 2019 in AB 5,..."

Check your contracts, taxes, and status before this passes.

Perhaps some California docs can chime in and let us know what happened after this. They were playing some strange word games in their recruiting out there, calling it "independent employee status" or some such BS to try and skirt the law but I haven't looked at it closely because I'd probably rather live and work in Syria than California. At any rate I can't imagine that the IRS would be amused by that when April 15th rolled around and you filed your 1040.

Mind you, I don't necessarily think this is a bad thing, reclassification as W2 employees with or without unionization may be the best chance we have of getting rid of CMGs.

Not sure about this bill but for the California one doctors were excluded from it so we can still be contractors

 

[Old_Mil]

Senate parliamentarian ruling clears way for Democrats to use reconciliation for infrastructure bill

It looks like the path has been cleared for it to pass.

 

[Old_Mil]

With regards to California's law it was apparently amended and doctors must pass the Borrello test to be classified as ICs.

"Except for app-based drivers, real estate salespeople, and repossessors, workers in all the exempt categories must pass the Borello test to be classified as ICs. The Borello test (based on the California Supreme Court's decision in Borello vs. Dept. of Industrial Relations) is similar to the right of control test used by the IRS. It's not nearly as strict as the ABC test. Under this test, the most significant factor is whether the hiring firm has control or the right to control the worker both as to the work done and the manner and means in which it is performed. In addition, the following factors are to be considered:

• whether the worker is engaged in an occupation or business that is distinct from that of the hiring firm
• whether the work is part of the hiring firm's regular business
• whether the hiring firm or the worker supplies the equipment, tools, and the place for the person doing the work
• the worker’s financial investment in the equipment or materials required to perform the work
• the skill required in the particular occupation
• the kind of occupation—whether, in the locality, the work is usually done under the hiring firm's direction or by a specialist without supervision
• the worker’s opportunity for profit or loss depending on his or her own managerial skill
• how long the services are to be performed
• the degree of permanence of the working relationship
• the payment method, whether by time or by the job, and
• whether the parties believe they are creating an employer/employee relationship.

No single factor in the Borello test is determinative, the first one—whether the individual’s work is the service or product that is the company’s primary business—is given the most weight.

Workers Subject to Borello Test Only​

Workers in the following categories need to satisfy only the Borello test to be ICs:

• physicians, surgeons, dentists, podiatrists, psychologists, veterinarians

I don't know what the federal law contains...but it wouldn't surprise me if they had a special carve out to continue to use physicians as pinatas. Still, if a group of physicians wanted to mount a challenge to the 1099/CMG model under the Borello test, it doesn't seem like an impossible task.