Unemployment Insurance - Worker Classification

General Private Employers

Prerequisite: Worker performs services for pay for employer

The first determination to be made is whether the worker performs services for pay for the employer. If it is determined that the worker "performs services for pay" for the employer, there is a presumption under the law that the worker is an "employee," not an independent contractor. That presumption can only be overcome by evidence, using the criteria found in the two-part test below, that the worker is an independent contractor. The two part test is found in Wis. Stat. § 108.02(12)(bm).

Part 1: Control or Direction

The first part of the two part test concerns "control or direction." The worker must be free of the employer's control or direction to be considered an independent contractor.

• If the worker is found to be under the control or direction of the employer, the worker is an employee.
• If the worker is free from the control or direction of the employer, the second section of the test is applied to the worker.

Part 2: Six of Nine Conditions

The second part of the two part test is "six of nine conditions". The worker must meet six of nine conditions in this section to be considered an independent contractor. If the worker does not meet at least six of the nine conditions, the worker is an employee.

The worker must meet the conditions of both parts of the two part test to be classified as an independent contractor. If the worker meets the conditions of one section but not the other, the worker is an employee.

Every employment situation is unique. The employer must carefully analyze the services provided by the worker and the relationship between the employer and the worker. The employer must then compare them against all of the conditions in the two part test.

To assist the employer in the analysis, the department has provided the following:

1. An explanation of each of the conditions contained in the two part test,
2. Case studies relevant to each of the conditions based upon cases decided by the Labor and Industry Review Commission (LIRC), Wisconsin Circuit Courts and Wisconsin Appellate Courts, and
3. Links to the LIRC Decision Digest in each of the sections of the two-part test, containing additional cases for review by the employer.

Take the Two Part Test: