Unemployment Insurance - Worker Classification

Indian Tribal Government

Employers are required by law to correctly classify each worker as either an "employee" or "independent contractor" for purposes of the employer's obligations under the law for unemployment insurance.

The unemployment insurance law uses a definition of "employee" (with exceptions) to separate those individuals (workers) who will bear the risk of their own unemployment (independent contractors) from those whose risk of unemployment will rest with the employing unit (employees).

A worker who "performs services for pay" is an employee unless the employer satisfies the criteria in the statute to classify the worker as an exception. We sometimes call the exception an "independent contractor."

It is important that you carefully read the definition of "employee" and the exceptions in the unemployment law: Wis. Stat. § 108.02(12).

Steps to Classify a Worker

If you are an employer or a worker and want to determine how to properly classify a worker as either an employee or an independent contractor for unemployment insurance continue to the worker classification test to begin the process:

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Note: When employed services were prior to January 1, 2011, tests for the old law will be used instead.

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