Certified Payroll Professional Practice Exam

What is the main benefit of meeting the Key control factors for classifying employees under the Department of Labor standards?

1. Greater control over job structure

2. Increased employer profits

3. Eligibility for tax incentives

4. Clarity in employment classification

The correct answer is: Clarity in employment classification

Meeting the key control factors for classifying employees under the Department of Labor standards provides clarity in employment classification. This means that by adhering to these factors, employers can accurately determine whether a worker should be classified as an employee or an independent contractor. This clarity is essential for compliance with labor laws and regulations, preventing potential legal issues or penalties that may arise from misclassifying workers. It also helps in establishing consistency in payroll practices and ensuring that employees receive the benefits and protections they are entitled to under the law.