"If a company signs an agreement with an Independent Contractor S corporation to perform contract work, the link between the company and the individual worker

"If a company signs an agreement with an Independent Contractor S corporation to perform contract work, the link between the company and the individual worker is broken. "By default, the way the Independent Contractor S corporation operates, there is no link between the company and the worker. The Independent Contractor S corporation is the employer of the worker. Even if that is an S corporation of one person. As the Independent Contractor S corporation employs the worker, it sets up its payroll which will deal with things like overtime compensation, itemized wage statements, compensation for business expenses, meal breaks and so on. "Again, it is the responsibility of the S corporation that hires the worker to make certain it complies with all applicable wage and hour laws. Labor code violations go out the window because each the Independent Contractor S corporation has its own employee(s). The S corporation has its own payroll from which the worker is paid. The S corporation has its own Worker’s Compensation Insurance Policy. "Clearly, there are some costs associated with contractors converting to S corporations. However, there is also a range of benefits. The savvy business owner currently working directly with 1099 contractors who looks at the A.B.C. test and realizes they are in violation, might incentivize their contractors to convert by sharing in the fees associated with forming an Independent Contractor S corporation. "While some contractors might be set up as LLCs, the majority of contractors start out as sole proprietorships. Simply converting LLCs taxed as proprietorships or partnerships to corporate taxation removes the barriers to employment for the contractor and removes the risk to the hiring company." https://www.incorporationattorney.com/new-independent-contractor-law-california-dynamex-ruling https://www.incorporationattorney.com/new-independent-contra...