Article
6 min read
How Do You Determine Employment Status with Deel’s Worker Classifier
Author
Jemima Owen-Jones
Published
March 15, 2024
Last Update
July 04, 2024
Table of Contents
How does Deel’s Worker Classifier work?
How does the tool integrate with Deel’s other platform features?
Unlock continuous compliance with Deel
Key takeaways
- Worker classification is essential because it determines the rights, benefits, and obligations of both the worker and the hiring company under employment law.
- Classifying international workers presents unique challenges for companies, mainly due to the complex and varied nature of international laws and regulations.
- Deel’s AI-powered Worker Classifier assesses the classification of your workers worldwide so you can fend off misclassification risks.
As your business expands and you explore new markets and talent pools, determining an Individual’s employment status becomes increasingly complex. Deel’s AI-powered Worker Classifier can support you in this regard, employing award-winning research on localized employment count cases and classification tests to classify your workers worldwide accurately.
What problem does the Worker Classifier solve?
Every country has different criteria for worker classification, and the case law is often very specific to particular business-worker relationships and is constantly evolving.
Until now, companies have had to track down country-specific guidelines and classification tests created by governmental bodies to categorize workers accordingly in line with employment laws.
Now, global companies can use Deel’s Worker Classifier to assess the classification of their workers worldwide.
What is employment status?
Employment status simply refers to whether someone is considered an employee, self-employed, or independent contractor. It’s all about the type of working relationship they have with the person or company they work for.
Here’s a breakdown of the different types of employment status and how they impact the employment relationship and work arrangements:
- Employee status: An employee works under a contract of employment. The employment arrangement typically has set hours of work, receives a regular wage or salary in line with the national minimum wage, and their employer deducts taxes and National Insurance (or Social Security) contributions from their pay. Employees often have more legal rights and benefits, such as sick pay, parental leave, and employment protections against unfair dismissal. Employees can work full-time or part-time
- Self-employed: Self-employed individuals work for themselves. They might have their own business or offer their services to different clients. Self-employed people usually have more control over when and how they work, but they’re responsible for paying their own income taxes and don’t have the same employment rights and protections as employees
- Independent contractor status: Independent contractors are also self-employed but work on a contract basis for clients or businesses. While they have more independence and a high degree of control over their work compared to traditional employees, they are hired to complete specific projects or tasks for a client under the terms outlined in a contract. Contractors are also self-employed for tax purposes. However, they may receive some benefits from the businesses they work for, such as access to certain facilities or resources, but they are generally not entitled to employee benefits like health insurance or paid time off
How does Deel’s Worker Classifier work?
Navigating the onboarding process for new hires has never been more straightforward and compliant. Just answer a few questions on the platform, and the tool will identify the worker’s classification using relevant local laws and precedent legal cases. You can use this classifier to assess (and re-assess) worker classification at any time—at onboarding and throughout the contract.
Deel’s Compliance Hub comprises a range of powerful AI-powered compliance management tools, each designed to help businesses stay on top of regulatory obligations. In addition to the Worker Classifier, Deel offers the following:
- Compliance Monitor to detect labor law changes and regulatory updates
- Workforce Insight Reports to alert you to international labor law and regulation non-compliance
- AI Assistant to get answers to your global hiring questions
How does the tool integrate with Deel’s other platform features?
Once you’ve classified your new hires correctly with the Worker Classifier, you can use Deel’s additional platform features to streamline global hiring and team management:
- Deel EOR for compliant hiring of international employees without an entity
- Deel Shield for compliant hiring of international contractors without liability
- Localized contract generation
- Benefits administration
- Background checks
- Equipment management
- Equity management
- Visa and immigration support
- Global payroll
Unlock continuous compliance with Deel
Deel’s Compliance Hub takes compliance to a whole new level by actively monitoring, flagging, and providing regulatory updates and compliance insights, helping you proactively navigate the ever-changing regulatory landscape.
Today, if you operate a global biz, you need a new level of always-on monitoring that Deel can provide. Our new Compliance Hub is built around this concept of continuous compliance. It’s an industry first, with three powerful features to provide a new level of proactive monitoring and insights. These features have local laws embedded directly into our platform, so we can serve up relevant insights about your workforce and flag potential compliance issues—like expiring visas, minimum wage and benefits considerations, and more. The goal is to save you time on complicated admin and money on costly errors. But more than that, we want to give businesses everywhere the confidence and peace of mind to hire the best talent, no matter where they are in the world.
—Alex Bouaziz,
Co-founder & CEO
Ready to put corporate compliance on autopilot? Book a call with a compliance expert to see how Deel can take more risk off your plate than any other provider.
