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Thursday, August 19, 2010

The Bad Neighbor, by Freda Moon [State Farm v. Pyorre]

The Bad Neighbor, by Freda Moon [State Farm v. Pyorre]: "The second issue, in Pyorre's view, is that State Farm is using the threat of termination to control its de facto employees. State Farm, for their part, argues that their agents have an 'at will' contract, meaning that they can be fired at any time, with or without cause.

State Farm assures the Internal Revenue Service that its agents are not employees (which allows them to avoid paying the start-up costs of establishing each new agency — the agent builds his or her own business — as well as a slew of state and federal taxes). Yet its agents are required to do things that, according to IRS guidelines for independent contractors, they cannot be required to do. And if they don't do what State Farm (their non-employer) demands, they get the ax."

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