CCDRA Test

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Can a DRA offer benefits such as Worker’s Compensation and/or Health Insurance to the domestic workers?
NO ▪ They are not employees of your DRA.
Does a DRA need to inform the domestic worker that they are not eligible for Unemployment Insurance, State Disability Insurance, Social Security, or Workers’ Compensation Insurance benefits?
YES ▪ Per 1812.5095 (d), the DRA must inform the worker that, as an independent worker rather than employee, they are not eligible for these benefits.
Can a DRA require the domestic worker to have their own Workers Comp Insurance?
NO ▪ This would show control. The domestic worker could be covered under the homeowner’s policy or obtain their own policy if they wish.
Can a DRA conduct a voluntary orientation session with the domestic worker?
YES ▪ Per 1812.5095 (b) 4, this is where all the contract provisions should be explained, including the above issues & the agency’s administrative & operating procedures.
Does a DRA need to have a signed contract with every domestic worker before referral to clients?
YES ▪ Per requirements in the Civil Code.
Is it important that the domestic workers agree and understand that they are independent workers, not the DRA’s employees?
YES ▪ This should be emphasized from the very first phone contact, & in all subsequent interactions. They should also be made aware of the benefits & freedoms unique to independent worker status, so the EDD can’t allege, as they have done in recent audits, that they were “forced” to be independents. Per EDD DE 40 “It is an indication of employment if either party believes that the relationship is employment…consideration should be given to the fact that many individuals…believe they are an independent contractor because they were told they are (i.e. not because they want to be or actually are).
Is it okay for the domestic worker to refer to you as a “boss” or “supervisor”?
NO ▪ This is an employer term. You must correct immediately by telling them they are Independent Domestic Workers - not an employee. An important part of the auditor’s determination concerns whether the worker actually views him/herself as an employee.
Does a DRA set the domestic workers schedule?
NO ▪ The domestic worker has control over the days, times and areas they want to have work referred to them. They should let you know their availability on the Registration Application. This is one of the many benefits to the worker of not being an employee.
Do domestic workers have the right to turn down a job offer?
YES ▪ The domestic worker has complete control over what clients/areas/days etc. they work; this is a freedom employees would not normally have.
Is it okay for the domestic worker to renegotiate the job price with a client?
YES ▪ This should be encouraged - shows they have control over the end result - 1812.5095 (b) 3.
Can a DRA tell the domestic worker how to do the job, provide training or supervision?
NO ▪ The Primary Factor in determining whether the workers are employees or IC’s is the right of control over the means and end result of the work.
Is it okay for a DRA to have a domestic worker clean their home to check the workers job ability?
NO ▪ Again this is a control issue. The best way to determine if the worker has the required skills is to check references and have them complete a “skills questionnaire” when they apply for registration.
Is it okay for a DRA owner to have a domestic worker clean their home at all?
YES ▪ As long as it’s not for the purpose of evaluating or directing his/her performance, and they receive their percentage of the regular job rate.
If you refer teams to clients can there be a team leader?
NO ▪ This would constitute supervision and control over the matter and means to reach the end result.
Is it okay for a DRA to refer a registered domestic worker to a client job when they know that domestic worker is taking an unregistered worker to the job?
NO ▪ The California Civil and Unemployment code states that DRA’s must interview, check workers job qualifications, verify legal status, and sign a contract agreement with ALL domestic workers that THEY REFER to clients.
Can regular reports from the domestic worker be required by a DRA?
NO ▪ Again this is a control issue if the reports constitute a review of the work; however, reports providing proof that the “end result” of the job was completed are okay (i.e. job length, payment amount).
If they wish, can a domestic worker provide their own client/job receipts?
YES ▪ This question has been asked during audits – forcing a worker to use a specific receipt, completed in a certain manner, is evidence of control. You may, however provide preprinted receipts free to the worker, which they may choose to use rather than buying their own.
If a DRA holds meetings can they require the domestic workers attend?
NO ▪ Shows control - why would you need meetings with non-employees?
Can a DRA provide or sell company T-shirts, uniforms, hats, badges, etc. to the domestic worker?
NO ▪ Not your employees - this would show control and is misleading to the public.
Can the DRA terminate a domestic worker?
NO ▪ 1812.5095 (b) 9 – Only for breach of the contract. The agency can discontinue offering new referrals but only the client or the worker can terminate an ongoing referral. This is also a highly influential common law factor, as the threat of termination is, per se, a means of control (see EDD form DE 38, worksheet on Employment Status).
Is the “right of control” the primary factor used by the EDD and IRS in determining employee status?
YES ▪ If the “right of control” is clearly demonstrated, this could end the audit immediately & result in a determination of employment - if the “right of control” is not present or unclear, then the auditor proceeds to the secondary factors.
For the purposes of worker classification, is having the “right” to control how the person works, and actually controlling how they work the same thing.
YES ▪ Even if you never exercise any control, it is still an employee/employer relationship if you have the right to do it. This is closely tied to the inability of the DRA to terminate, as “the employer exercises the control through the ever-present threat of dismissal, which causes the worker to obey instructions” (DE 40).
Can a domestic worker quit a particular job at any time without incurring liability?
NO ▪ Independent workers are legally obligated to make a good faith effort to complete the job or they could incur penalties (DE 40); however, they may request the DRA find a replacement referral once a particular job is completed (see EDD form DE 38, worksheet on Employment Status).
Can a DRA set a day and time that the domestic worker must come in the office weekly to settle fees?
NO ▪ Shows control, a contractor can get paid after each job completion, an agency can ask for settlement of fees to be on a regular basis (say once weekly or every 10 days).
Is it okay for a DRA to go to the client’s home to provide an estimate, inspect or resolve a dispute?
NO ▪ Only the worker is responsible for the end result of the job. You can never go to a client’s home - this shows control. Think of your DRA as the messenger.
Is it okay for a DRA to provide the domestic worker with a list of cleaning supplies and equipment they will need to complete jobs?
NO ▪ Shows control, the domestic workers are professionals and as such should know what supplies to use.
YES ▪ Supports there IC status and shows that they are independent of control by the DRA.
YES ▪ Even though the relationship between a domestic worker and client can only be terminated by either of those parties, the agency may decline additional referrals to a worker.
NO ▪ A DRA must inform a domestic worker prior to signing a Contract that, depending on local ordinances, they may be obligated to obtain business permits or licenses (1812.5095 d).
NO ▪ This would show control over the end result of the job. to edit..
YES ▪ The DRA is required by law to get the correct documentation to complete the I-9. If applicant is not a US citizen must see documentation showing they can legally work in US.
NO ▪ They fill out a Registration application.
YES ▪ In recent audits, the auditor researched all the DRA’s advertising, including looking online.
NO ▪ Either a starting amount or range “from” and “to” can be specified.
NO ▪ You register them.
NO ▪ Our civil code dictates that we provide service to private homes only.
YES ▪ The DRA is in the business of employee placement and referrals. The domestic worker is in the business of providing client services such as cleaning, laundry, etc.
NO ▪ Again, this would indicate that you’re in the business of “cleaning” rather than in the business of “referring”.
NO ▪ Shows control over the domestic workers independent cleaning business.
NO ▪ A “cleaning company” is in the business of cleaning, & has employees to accomplish that; we are in the business of making referrals, & therefore should be named “Suzy’s Cleaning Agency” or “Suzy’s Housekeeping Personnel Service”.
NO ▪ Only the domestic worker can be responsible for the end result of the job. However, a DRA may call the client to determine if they were happy with the referral and offer the client a new referral if appropriate ~ 1812.5095(b) 5B.
NO ▪ The agency is not responsible for the quality of work and therefore cannot offer a discount to the client based on the quality of the cleaning. The domestic worker, however, is responsible and has the ability to negotiate a remedy that works for the client. This may include a discount on the amount paid by the client, which will affect the settlement fee calculation.
YES ▪ This is required by the civil code, & will be scrutinized during an audit. The workers income is needed for the required reporting on DE 542 and Form 1099.
NO ▪ They make a % of the client payment or a set amount of the completed job.
NO ▪ Per 1812.5095 (b) 6 - The DRA does not provide tools, supplies or equipment - don’t even have cleaning supplies in the office.
NO ▪ 1812.5095 (b) 7 - The client is paying both the worker’s fee and referral fee; any percent of zero is zero.
Yes ▪ If the client is a “no pay” then the worker is not paid. If they break or damage the client’s property they are responsible for repair or replacement cost; if the worker has traveled to the client’s house & the client is a no-show, the worker is out the cost of transportation & time.
NO ▪ W2 is withholding of taxes for employees ~ IC’s must be issued a form 1099.
YES ▪ Requirement per 1812.5095 (f).
NO ▪ 1812.5095 (f) & (g) - considered to be misleading to the public and unfair competition. Per the client disclosure, whether the cleaner is an employee or independent contractor depends on the client’s relationship with the worker.
NO ▪ This is considered misleading the client - unfair business competition - can result in civil penalties of $2500 per violation.
YES ▪ If an agency misleads the public by not complying with Civil Code 1812.5095 it is considered unfair competition and can result in penalties of $2500 per violation.
NO ▪ Since the DRA doesn’t “use” or provide the products and has no control over what types of products workers choose to use.
NO ▪ The Independent Domestic Worker is responsible for damages caused by their actions. If the agency pays it indicates that the DRA is responsible for the damages of its workers, & therefore is their employer.
Yes ▪ An EDD requirement for all businesses with contractors.
YES ▪ per DE 40 (EDD Tax Audit Guidelines), chapter IX, Section A1 “The auditor…will ask the employer why he/she believes the workers in question are independent contractors. This may bring out issues the auditor has not considered.” The best possible answer?? Because we’re in full compliance with the provisions of Ca Civil Code 1812.5095!
YES ▪ CC 1812.5095 requirement.
NO ▪ A DRA must pass the Primary Factor of “right of control” - but if you have IC’s (IDW’s) you must issue 1099's
NO ▪ This is not considered control over the matter and means by which the domestic worker performs their work.
NO ▪ They can be a self-employed, an independent contractor.
YES ▪ According to the DE 231L it must be first determined if the worker is an employee under common law, then it must be determined if the DRA is operating as an employment agency, then it must be determined that the DRA is in compliance with CC 1812.5095 and UIC 687.2.
YES ▪ The relationship would need to be reviewed using these factors, the primary factor being the right to control the matter and means by which the domestic worker performs their work.
NO ▪ It is recommended that a DRA never fills out any forms received that include the words; employer, employment, employee, etc. However, it is recommended that you reply to the claim with a letter, example in Section 7 of your DRA handbook. Not answering could imply that you are the employer.
YES ▪ DRA’s are required to comply. Any company that utilizes IC’s in California are required to complete EDD form DE 542 as a means for government agencies to locate IC’s that owe taxed to the FTB, BOE, Back Child Support, etc.
NO ▪ This action is unlawful and considered aiding and abetting the underground economy. By agreeing to this you would be subjecting your DRA to fines, penalties and other possible repercussions.
NO ▪ Cleaning companies have employees. DRA’s are employment agencies and must operate in compliance with the employment agency CC & UIC laws in order to have the domestic worker found to be IC’s, not employees, when audited.
NO ▪ This action is unlawful and considered aiding and abetting the underground economy. By agreeing to this you would be subjecting your DRA to fines, penalties and other possible repercussions.
NO ▪ Cleaning companies have employees. DRA’s are employment agencies and must operate in compliance with the employment agency CC & UIC laws in order to have the domestic worker found to be IC’s, not employees, when audited.
YES ▪ It is okay for DRA’s to have an administrative process in place for settlement for fees. However, any IC has the right to demand immediate payment once a job has been completed and payment is in hand. To not honor an IC’s request would be exercising financial control over the domestic worker. Example: If a domestic worker shows up and demands their check, and all client payments are accounted for (in hand or in the trust account), then settlement should be processed and a settlement check issued.
YES ▪ The CC allows client payment to be made directly to the domestic worker or the DRA. The domestic worker has the right of control over the means of payment. A domestic worker could have the check written out to them and return the referral percentage to the DRA. This supports there IC status and shows that they are independent of control by the DRA.
YES ▪ Your website is paid advertising, representing your business operation.
YES ▪ Don’t let your website blunders bite you in the butt. You could be putting your livelihood and the entire DRA industry in jeopardy.
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