According to the U.S. Department of Labor, the legal definition of an employee and an independent contractor is confused by different identification measures in several state and federal laws. In addition, not all regulations apply to both agents and independent contractors. An example of this is the minimum wage requirements, which are set out in the Fair Labour Standards Act and apply only to employee agents. In other cases, the laws governing how certain work functions, such as real estate transactions, are performed, apply to both agents and independent contractors. An employer hires an employee to work on behalf of the employer within or to support the core functions of the business. The employee usually works exclusively for the company in the functions for which she is hired. The employer has full control over the nature, timing and manner in which the work is performed by the employee. As such, the employee is a general representative of the company to the extent of his authority in the position.
An agent is a person who acts on behalf of and on behalf of others after receiving and accepting a certain degree of authority to do so. Most organized human activities – and virtually all commercial activities – are carried out through agencies. No business would be possible without such a concept, not even in theory. For example, we could say, “General Motors builds cars in China,” but we can`t shake hands with General Motors. “The general,” as they say, exists and functions through agents. Similarly, partnerships and other commercial organizations rely heavily on agents to manage their activities. In fact, it is no exaggeration to say that the ability to act is the cornerstone of the organization of companies. In a partnership, each partner is a general representative, while under corporate law, officers and all employees are representatives of the company. Question: What determines the difference between an independent contractor and an agent in a broker/shipper relationship? Explain how the court will determine whether a person is an employee, an independent contractor or a representative. To perform his or her duties, an agent often has to appoint his or her own officers. These appointments may or may not be approved by the client.
For example, an insurance company may appoint a general agent to open offices in cities in a particular state. The agent will necessarily conduct his affairs through agents of his choice. These agents are subagentsThe agent of an agent. of the customer, if the general representative had the express or implicit authority of the customer to order them. For legal purposes, they are representatives of the principal and the principal representative of the principal, and both are responsible for the conduct of the subcontractor, although the general agent normally agrees to be primarily responsible (see Figure 14.3 “Co-agent”). It is not clear when it comes to determining whether someone is a contractor or an independent agent. An independent contractor has almost absolute discretion, while an agent is controlled by the client. Due to the client`s control, responsibility for the representative`s actions is assigned to the client more appropriately.
However, as most business lawyers will tell you, there is a grey area between the two that requires factual investigation and can often lead to litigation. The difficult part of distinguishing between the two relationships is that even if you have an independent contractor contractual relationship, the court can still determine that it is an agent. In other words, calling someone an independent contractor in a written document is not necessarily a clear case. The factual nature of control within the relationship is a primary consideration. The court will look at all kinds of facts about the relationship and who controls what. In this chapter, we look at the main-agent side of the triangle. In the next chapter, we will discuss relationships between third parties. However, the existence of agents does not require an entirely new law on tortious or contractual liability. An offence is no less harmful when committed by an officer; A contract is no less binding when it is negotiated by an agent. What needs to be taken into account, however, is how an agent acts on behalf of his or her principal and vis-à-vis a third party. When a patient goes to the hospital for treatment, a “estoppel agency” may occur. The crucial question is whether the patient goes to the hospital for treatment.
Id. If a patient “. to rely solely on the hospital for its treatment and to rely on the hospital and to have been treated by medical personnel regulated and authorized by the hospital to provide medical services in its emergency room and because such staff have been placed by the hospital in an obvious position of authority to act on behalf of the hospital, the hospital is prevented from denying any responsibility for the alleged negligence of its alleged agents. Admittedly, members of the public who use the emergency services of a hospital in those circumstances have the right to expect competent medical treatment from medical staff who, through the conduct of the hospital, which reasonably leads the public to believe that the medical treatment is provided by doctors acting on behalf of the hospital. and not under their respective personal responsibility. Therefore, the hospital must be held liable for the negligence of its licensed emergency physician, whether or not it is an independent contractor, through secret restrictions contained in a private contract between the hospital and the physician, or due to any other business relationship unknown to the patient and in violation of the hospital`s conduct and insurance. “Id. at 282-283. Agencies created by consent – agreement – are not necessarily contractually binding. It is not uncommon for one person to act as an agent for another person without consideration. For example, Abe asks Byron to run errands for him: buy wood from his account at the local lumber yard.
Such a free agencyAn agency where the agent does not receive compensation. does not produce any results other than the most common contract agency. The employees you hire and who work under your command fall into the category of agents. Interrupted assistance for temporary or recurring tasks may fall into the category of independent contractors. Essentially, a court will pay attention to the extent of control you exercise over the person you hire to determine whether the person you hire is a contractor or an independent agent. If you outsource a job to another company or someone who specializes in that industry or task, that person hiring will most likely be considered an independent contractor, especially if you leave that person with a high degree of discretion. If you regularly hire someone or let them work under your control with less discretion, the courts will likely believe that these people are agents. For someone to be an agent, there must be actions that show the control needed to make someone an agent.
Without sufficient control, they are instead classified as an independent contractor. The main difference between an agency and an independent contractor is that the client is not responsible for the actions of the independent contractor, but can very well be held responsible for the actions of a representative. .
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