Contractor vs Employee Classification Memo: IRS Test, State ABC Risk & Fixes

For US founders, HR leads and fractional CFOs: a written classification memo for any worker, applying the IRS common-law test, FLSA economic reality and state ABC tests, with a risk rating, a 1099-NEC or W-2 recommendation and the contract and process changes to make.

Use cases

• A startup with a long-term California 'contractor' who works like a team member and needs a defensible decision.
• An HR lead reviewing all 1099 workers before year-end 1099-NEC filing.
• A fractional CFO documenting reasoning for an investor due-diligence request on contractor risk.