Question # 1: Advice to Tom: Sub issue #1: Harassment Sub Issue #2: Meal Period Rights Sub Issue #3: OT (1) Here because she is likely an employee per the discussion below, we need to determine if she is except. (2) Question #2 What has the company done correctly and incorrectly? How can the position be improved? Ellen Issue #1: Independent Contractor vs. Employee Facts: (1) Woodworking Company (2) Keeping track of customer logs Updating customer info Handling Customer Service calls, Placing orders Ensuring Payments received (3) IC Agreement. Rule: Balancing test. Presumption of employee. Look to the totality of the circumstances in balancing the following factors: (a) #1 is control. Here she it seems likely she is working in the office. And the duties are not items that would be able to be executed in a vacuum with only instruction as to the product of her work from the employer. (b) Nature of the work. The nature of the work is that it is in the office doing detail admin work for the company. Not usually a service or product provided by a contractor. (c) Tools. No tools are provided by employee (d) The service is also done in the course of the company’s business. So that leans towards employee. (e) The relationship is of indefiniteness (really at will, so perpetual), which also does not lend itself towards a contractor relationship, as contractors are contracted to do a particular job, usually of finite duration. (f) A contract is a starting point in layout out a contractor’s relationship, but it is not definitive, therefore balance the aforementioned factors. They balance on the side of an employee because (a) through (e) each fall on the side of employee, per the analysis in each section. The company has incorrectly setup its employee relationship. Issue # 2 Discrimination against other employee’s Because of always taking to lunch, raises and bonus, there is some preferential treatment here. Tom is opening himself to liability if there is another employee that could claim discrimination based on one of the protected classes. Issue # 3 Leave Right? With regard to the request to have time off with her son. Not subject to family leave because son is 4 years old. No baby bonding under Family and Medical leave act. Best Practices: Reasonable Accommodation vs. Undue Hardship. Here there is no obligation for time off, and there is a hardship, so Tom clearly in the right. Issue # 4 Implied Contract for bonus at the end of the year? Issue # 3 Harassment Ellen goes to see Holly HR manager and makes a claim. Sub Issue #1: Duty to do a Reasonable Investigation.