Worker Classification Checker
Describe a proposed working arrangement and receive an analysis under the IRS Common Law test, ABC test (CA/MA/NJ), and FLSA Economic Realities test. Identifies which factors support IC status and which create misclassification risk. Adapted from Anthropic's claude-for-legal employment skill.
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Not legal advice. This tool is for informational and research purposes only. AI outputs must be reviewed by a licensed attorney before any reliance. Do not input confidential client information. Outputs are generated by Claude and may contain errors.
What Is the Worker Classification Checker?
Misclassifying an employee as an independent contractor is one of the most expensive legal mistakes a business can make. The penalties include back taxes and penalties from the IRS, state unemployment and workers' compensation liability, FLSA overtime back pay, benefits liability, class action exposure, and potential criminal charges in egregious cases. Worker classification analysis — understanding which legal tests apply and how a proposed arrangement scores against them — is essential before engaging any contractor.
This tool analyzes a proposed working arrangement under three key legal frameworks: the IRS Common Law test (the primary test for federal tax purposes), the ABC test used by California, Massachusetts, New Jersey, and other states (which imposes a strict presumption of employment), and the FLSA Economic Realities test used by the Department of Labor for wage and hour purposes. Each test weighs different factors, and a single arrangement can fail one test while passing another.
Describe the proposed engagement in detail: what work the person will do, who controls the hours and methods, whether they use your equipment or their own, whether they work for other clients, how they are paid, and where the work takes place. The more specific your description, the more useful the analysis. The tool identifies which factors support independent contractor status and which create misclassification risk — giving you a factual roadmap for structuring the engagement.
This tool is for PROSPECTIVE arrangements only — not for analyzing existing relationships that may already constitute employment. This analysis does not constitute legal advice. Worker classification is highly fact-specific and varies by state. Always consult an employment attorney before engaging workers in a new arrangement.
Example Output
How to Use This Tool
- 1Describe the proposed working arrangement in detail: the work to be done, who controls hours and methods, equipment used, other clients the worker has, payment structure, and work location
- 2Note the state(s) where the work will occur — the ABC test applies in California, Massachusetts, New Jersey, and others, making classification significantly harder
- 3Click 'Generate Classification Analysis' and allow 25–35 seconds
- 4Review the factor-by-factor analysis for each applicable test, the overall risk assessment, and the recommendations for structuring the engagement — then consult an employment attorney
Who This Tool Is For
- ✓Startups evaluating whether to engage a developer, designer, or content creator as a contractor or employee
- ✓HR and legal teams assessing the misclassification risk of a proposed gig worker engagement
- ✓Businesses expanding into California or other ABC test states evaluating contractor arrangements
- ✓Small business owners deciding whether to hire staff or engage service providers
- ✓Operations teams reviewing contractor arrangements for compliance risk before an audit
- ✓M&A counsel assessing target company contractor workforce for classification liability
Frequently Asked Questions
What is the ABC test and why does it matter for California?
California's ABC test (Labor Code § 2775) presumes every worker is an employee unless the hiring entity can prove all three prongs: (A) the worker is free from control; (B) the work is outside the company's core business; (C) the worker has an independently established business. Prong B is extremely difficult for most arrangements and is why California is one of the hardest states for IC classification.
Which states use the ABC test?
As of 2026, states with strict ABC-style tests include California, Massachusetts, New Jersey, Vermont, Connecticut, Illinois, and others. The specific prongs vary by state. Always identify the applicable state law for each engagement.
Can one working arrangement fail one test but pass another?
Yes — and this happens frequently. An arrangement may satisfy the IRS Common Law test (for federal tax purposes) but fail California's ABC test (for state labor law purposes). This creates a situation where the worker is a contractor for IRS purposes but an employee under California law, exposing the company to state-level liability.
Is this tool useful for gig economy and platform businesses?
Yes — gig and platform businesses face the most aggressive worker classification enforcement. This tool provides useful preliminary analysis, but platform businesses should work with specialized employment counsel given the rapidly evolving regulatory landscape.
This tool is for prospective arrangements only — why?
Analyzing an existing worker relationship requires examining actual conduct over time, not just the intended arrangement. If you have an existing contractor relationship you are concerned about, consult an employment attorney directly — do not attempt to restructure retroactively without legal guidance.