Federal Tax

Employee Benefits for the Contingent Workforce (Portfolio 399)

  • This Portfolio addresses the employee benefits-related questions and issues that arise in connection with the employment of contingent or alternative workers.

Description

Tax Management Portfolio, Employee Benefits for the Contingent Workforce, No. 399, addresses the employee benefits-related questions and issues that arise in connection with the employment of contingent or alternative workers. These workers include independent contractors, leased employees, freelancers, on-call employees, contract/technical workers, and part-time, seasonal and temporary employees, among others, that are employed under a myriad of employment arrangements that have come to characterize the “contingent workforce.” Such arrangements include outsourcing, pay-rolling, master vendor arrangements, employee leasing, and the use of professional employer organizations. The Portfolio describes the fundamentals of worker classification principally under the Internal Revenue Code and the Employee Retirement Income Security Act of 1974, and it examines the tax and benefits consequences of worker misclassification in a variety of traditional and non-traditional employment settings such as partnerships, LLCs, joint ventures, and multiple employer arrangements. Considered in detail are the issues that arise when contingent workers are improperly covered under, or excluded from, qualified and nonqualified retirement plans, welfare plans, certain fringe benefit plans, and stock-based compensation arrangements. Also covered are the emerging questions of fiduciary responsibility for the proper classification of workers under ERISA-covered pension and welfare plans.

Table of Contents

I. Worker Classification and the Contingent Workforce
II. Employment Status – Common Law Employee v. Independent Contractor
III. Coverage of Contingent Workers under Employee Benefit Plans
IV. Special Plan Coverage Issues and Problems
V. Coverage of Contingent Workers under Stock-Based and Incentive Plans
VI. ERISA Fiduciary Standards and Contingent Workers

Alden Bianchi
Member
Mintz Levin PC
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