A Guide To STARTING A BUSINESS IN MINNESOTA 42nd Ed 2024

5. is responsible for the satisfactory completion of the services that the individual has contracted to perform for the person and is liable for a failure to complete the services; 6. receives compensation from the person for the services performed under the contract on a commission or per-job or competitive bid basis and not on any other basis; 7. may realize a profit or suffer a loss under the contract to perform services for the person; 8. has continuing or recurring business liabilities or obligations; and 9. the success or failure of the individual’s business depends on the relationship of business receipts to expenditures. In addition to compliance with this nine-factor test, business entities and their owners and officers are required to conduct business appropriately including active filing with the Secretary of State, if required; invoices are submitted in the name of the business entity, not individuals and payments are made to the business entity, not individuals. Penalties may be assessed for failure to register with the Minnesota Department of Labor and Industry, hiring unregistered contractors, misclassifying workers or coercing others to form a business entity. Additional information is available at Construction Contractor Registration.

INDEPENDENT CONTRACTORS IN THE TRUCKING AND MESSENGER/COURIER INDUSTRIES

Minn. Stat. § 176.043, lays out the criteria for when an operator in the trucking and messenger/ courier industry is considered an employee or an independent contractor. There are seven factors that must all be present for a worker to be considered an independent contractor. Some of the factors include when the individual: • owns the equipment or holds it under a bona fide lease agreement; • is responsible for the equipment’s maintenance; • is responsible for the operating costs; • is responsible for supplying the necessary personal services to operate the equipment; • substantially controls the means and manner of the service performance; and • enters into a written contract specifying that the relationship is one of an independent contractor and not that of an employee. FURTHER INFORMATION In addition to consulting a professional advisor, more detailed information on “Who is an Employee” for various purposes may be obtained from the following sources and at the addresses and telephone numbers listed in the Resource Directory section of this Guide. See also the section of this Guide titled “Checklist for Hiring an Employee.”

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