If at ... second you don't succeed, fail again a third time - or - Shannon gonna Shannon

Stevennon Achungmalbe is back again with another article discussing the differences between an employee and independent contractor.  Astute readers may remember that Stevennon botched this same topic last week (affiliate link).  Well, s/he's back again with more head scratchers in a meandering set of words having something to do with the tax treatment of independent contractors versus employees.  Here are some of the highlights:

The blur has created some unexpected results. For example, you might be surprised to learn that professional athletes are employees of either their team or their league (MLB, NFL, NBA, etc.). You would think that with their endorsement contracts, and possible side ventures, they would want to be independent contractors and take advantage of the more generous tax write-offs. On the other hand, if they were to get injured during a game, they would prefer that their employer foot the medical bills and qualify for disability benefits.

Nope.  Not surprised at all.  Professional athletes are some of the most obvious employees out there.  Under any test/definition for determining an employee-employer relationship, the first factor to address is the degree to which the employer controls the employee's work.  Outside of the military, I can't think of a more controlled population than pro athletes.  They are required to show up at X time on X date for practice, required to wear certain uniforms, required to travel across the continent/hemisphere for games, required to execute plays as directed by coaches/managers, and forbidden from engaging in certain enumerated activities as well as playing for a competitor.  This is not even close.  If you're surprised by the fact that athletes are employees and not ICs, you need to spend all your MCLE hours on employment law.

Next, what the hell does an athlete's side venture have to do with his or her classification vis-a-vis the team for which he or she plays?  There is no reason Lawrence Taylor can't be employed by the NY Giants as a football player and be self-employed with respect to the eight shady car wash stations he owns (note: I have no idea whether LT owned car washes, it was just a common [poor] investment for football players at the time).  The two are entirely separate businesses.

Sticking with LT, he signed a contract extension in 1990 which paid him about $1.6 million per year in taxable wages.  The team pays for his equipment, uniforms, trainers, and travel (at least 8 away games per year).  Not accounting for the cap on social security taxable wages, being treated as an independent contractor and therefore required to pay the full 15% taxes on his wages as opposed to 7.5% would cost him $120,000.00 per year.  What write-offs would he have as a football player for the NY Giants?  If he pays for his own travel, equipment, uniforms, training staff, and other amenities/services/perks enjoyed as a player, I'd guess that would have cost around $75k in 1990.  Even rounding up to $100k and treating those costs as business expenses, all that would get LT is a reduction of $100k in taxable income.  Assuming a tax rate of 33%, LT's just thrown away $220k to make an extra $33,333?   Sweet deal.

Finally, an employee injured in the line of work is entitled to workers comp benefits, which are not "disability benefits."  That aside, Achungmalbe must not watch a lot of sports.  In all three leagues he mentions, the players are unionized and compensation for injuries is covered by the respective CBA.  In the NBA and MLB, most all contracts are fully-guaranteed, meaning an injured player gets paid whether he plays or sits at home recovering from surgery.  NFL contracts are a bit different.  Some of the stars have contracts with a guaranteed minimum but, for any other player, he can only be cut from the team while injured if he reaches an injury settlement with the team.  If there's no injury settlement, he continues to receive his base pay.

Next up, we  return to Stevennon's famous cab owner buddy s/he met at a mixer:

As I mentioned in my previous column, I use a local transportation service if I need to get somewhere and I am too lazy to drive. The owner networked and advertised for customers. Or he may just drive around an airport or a bar in order to pick up a customer who needed a ride home. In this case, most would agree that he is an independent contractor since he sets his schedule and finds his own customers. But services like Uber provide the customers to the driver so long as he turned on the app and reported for duty. Would that automatically make him an employee? He might be an employee under the ABC test, but not under the common law test, according to an opinion from the general counsel of the National Labor Relations Board.

This is just a really weird line of thinking.  It is technically correct that the driver is an independent contractor (with respect to passengers), but that's not what Stevennon seems to be getting at judging by the introduction of Uber later in the paragraph.  The comparison makes no sense.  The taxi driver owns his own vehicle and is out hustling for business on his own.  He gets his own business and collects the entire payment.  There is nobody "above" him telling him where to go or paying him.  There are only two parties to the transaction - the passenger and the driver.  Technically, the driver is an independent contractor of the passenger.  Anyone who thinks otherwise is smoking crack.

Introducing Uber into the equation breaks it.  The driver still has an independent contractor relationship with the passenger.  That will not change.  The current controversy/battle is whether, by using Uber to facilitate business and handle payments, the drover becomes an employee of Uber.  I just don't get what Stevennon is getting at here - it's not an apples-to-apples comparison.  Please. Stevennon, just stop.