47. Fallon is a real estate agent who mainly controls how she works and is paid by commissions. Blake works for a brokerage as a secretary, is paid hourly, and his boss controls how his work is performed. Who is an independent contractor and who is an employee?
Answer: C
Fallon is an independent contractor; Blake is an employee.
Fallon operates as an independent contractor since she controls her work and is compensated through commissions. In contrast, Blake is classified as an employee because he works for a brokerage, is paid hourly, and his work is controlled by his boss.
A) Blake is an independent contractor; Fallon is an employee
This option is incorrect because it misidentifies the working relationship of both individuals. Blake's hourly wage and lack of control over his work indicate he is an employee, while Fallon’s commission-based pay and autonomy classify her as an independent contractor.
B) Both Fallon and Blake are independent contractors
This choice is incorrect because it overlooks the fact that Blake is paid hourly and works under the direction of his employer. Independent contractors typically have more control over their work and payment structures, which does not apply to Blake.
C) Fallon is an independent contractor; Blake is an employee
This option accurately describes the working arrangements of both individuals. Fallon operates independently, setting her hours and determining how to achieve her sales, while Blake's structured role and hourly pay clearly define him as an employee.
D) Both Fallon and Blake are employees
This selection is incorrect as it fails to recognize Fallon’s independent contractor status. Fallon’s control over her work and commission-based payment structure differentiate her from Blake, who is bound by his employer's directives and payment method.
Conclusion
The correct identification of Fallon as an independent contractor and Blake as an employee is based on their respective levels of control over their work and how they are compensated. Fallon's autonomy in working and earning commissions supports her status as an independent contractor, while Blake's hourly wage and employer oversight confirm his position as an employee. Other options fail to accurately reflect these distinctions.