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When contracting with temp or payroll services, make sure it’s clear who the real employer is

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in Employment Law,Human Resources,Small Business Tax,Small Business Tax Deduction Strategies

Sometimes, it’s possible for an employee to have two employers. That’s often the case when a temporary service provides workers for a client, and both the temp company and the client exercise significant control over how and when the work is performed.

But now there’s a new wrinkle. The Court of Appeal of California has refused to extend this joint-employer concept to a company that handled the details of payroll and workers’ compensation insurance and listed itself as the employer on tax filings and other government forms.

Recent case: John Futrell’s work involves providing freelance security services during the production of television commercials. In 2002, Reactor Films, a production company, engaged Futrell and other temporary workers to work on its commercials. Reactor outsourced the payroll and insurance functions to a company called Payday California.

Payday listed itself as the employer on paystubs, tax filings and o...(register to read more)

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