Oregon Construction Contractors (CCB) Practice Test

Which of the following indicates a contractor is likely an employee rather than an independent contractor?

1. Receives a consistent payment

2. Maintains his or her own business

3. Is free from direction and control

4. Uses their own tools and equipment

The correct answer is: Receives a consistent payment

Receiving a consistent payment is a strong indicator that a contractor is likely an employee. In the context of employment classification, employees typically receive regular wages or salaries on a set schedule, such as biweekly or monthly. This consistent payment structure reflects a level of control and predictability that is characteristic of an employer-employee relationship. In contrast, independent contractors often operate with more flexibility regarding their payment schedules. They may invoice clients for work completed and receive payment upon project milestones or at the completion of a job, leading to varying income streams. This financial autonomy, alongside other factors like maintaining their own business and using their own tools, further supports the classification of independent contractors. Additionally, independent contractors are generally free from direction and control regarding how they perform their work, which further differentiates them from employees. Overall, the consistent payment received by a contractor leans towards the structure found in traditional employment, marking them as more likely to be an employee.