Question

Salvatore and Annette are sales managers for Acme USA. Both work full-time in the Acme offices under the same manager, and share the same type of job responsibilities. Salvatore was hired as an employee, and is paid a salary. Required federal and state tax withholdings are made by Acme for Salvatore. Annette was hired as an independent contractor, and is paid by the project. No federal and state withholdings are taken for Annette, and she does not receive retirement or health insurance benefits. Which of the following is the likely true
Acme properly classified Annette as an independent contractor
Acme willfully misclassified Annette as an independent contractor and is liable under Fair Labor Standards Act of 1938.
Acme has no rights to withhold federal and state taxes for Salvatore if he is classifed as a full-time employee.
Acme has to provide more health and retirement benefits to Annette than Salvatore because Annette is an independent contractor.

Answer 1

Answer:

The correct answer is the option B: Acme willfully misclassified Annette as an independet contractor and is liable under Fair Labor Standards Act of 1938.

Explanation:

First of all, an independet contractor is the name that a person receives when provides goods or services under a written contract however they do not work regularly for an employer but work as required.

Secondly, the Fair Labor Standards Act of 1938 is a United States Labor Law that creates certain standards that must be accomplished by the employers regarding topics like a minimum wage, ''time-and-a-half'' overtime pay and many others. The basic of this act is to establish standards and protect particular situations regarding the less benefited employees.

Finally, in the case of Acme, where Annette was hired as a independent contractor the company willfully misclassified her due to the fact that she has the same duties and hours of job as Salvatore therefore the company is liable under the Fair Labor Standards Act of 1938 to give her the same salary and health insurance.