What Counts as an Independent Contractor at a Brewery

Modern breweries have a large workforce made up of several types of employees. In the case of California breweries, it is important to know how the employees will be classified based on the ABC Test before hiring independent contractors. This information influences onboarding and stipends, to the documentation required to smooth out the operations. Be it seasonal brewers, taproom personnel, or freelance marketing assistance, it is better to be acquainted with the regulations in the first place and help the breweries remain within the law and concentrate on what they are good at: producing a great beer and creating a high-quality experience for their clients.

ABC Test Overview for Breweries

In California, workers are presumed to be employees unless they can pass all of the following:

Autonomy

Workers must have the ability to control their own work. If you tell the worker when to come to work and how to perform tasks, or if you manage the worker as if they were a full-time employee, the autonomous requirement will be hard to defend.

Business Alignment

The work must not be related to the primary business of the brewery. (Breweries brew beer, package beer, sell beer, and serve beer). The majority of activities performed by breweries relate directly to the brewery’s primary business.

Customarily Independent

The employee must conduct an actual independent business and have their own tools, multiple clients, marketing presence, etc. When you can check off all three of these criteria as being met, you could say that you are in a contractor-friendly zone. Once you fail to meet any of the above, then the individual would most likely be a W-2 employee.

Here are a few job positions in the beer industry and how they measure up against the ABCs;

1. Brand Ambassadors

Brand ambassadors are usually used in arranging tastings, pouring at festivals, and marketing the brewery. They are of direct advantage since they contribute to the business of the brewery via sales and marketing. In case you are giving your brand ambassadors a schedule, instructing them or telling them what to do or how the events are going to take place, they would be considered employees according to the ABCs.

2. Festival Judges

Festival judges are judges who work on a part-time basis. They usually have a speciality in judging for festivals. Since festival judges usually work independently of a brewery’s day-to-day operations, the risk of bringing them on is low. Many judges lend their expertise to multiple festivals at once, making it appropriate to classify them as contractors. This approach allows breweries to tap into experienced talent while keeping operations flexible and focused on brewing great beer.

3. Cellarmen/Production Assistants

If they are cleaning tanks, transferring beer from tank to tank, canning, packaging or performing other production-related duties, cellarmen/production assistants would be classified as brewery workers. The risk for a brewery associated with a production assistant can be extremely high. There is no way to consider these individuals as not being employees under the ABCs.

4.  Freelancer Creative Designers, Photographers, etc.

An independent or contracted professional who offers these services outside of a brewery’s normal functions generally provides his/her services to multiple businesses. If a freelance designer/photographer/content creator creates work for you and bills you directly for their services, owns the equipment they use, makes their own appointments, and produces work independently of your brewery, they are considered an independent contractor.

Paperwork You Should Request Before Paying a Contractor

Once you have verified that the person meets the ABC test, ensure that you collect the necessary documentation before issuing a payment. Request the following:

•  W-9 for tax filing
• Invoice detailing work performed
• Business license or proof of insurance (if applicable)

This helps create an efficient system for both you and your contractor while also keeping your finances organised for end-of-year reporting purposes. To simplify this process, you could use a W-9 generator like FormPros. It simplifies the process of completing the form and helps identify common mistakes. This is helpful for seasonal/short-term contractors that you may have onboarded.

Onboarding Contractors Without Misclassifying Them

To maintain compliance:

• Don’t dictate their daily schedule
•   Don’t supervise them as if they were an employee
• Assess based on deliverables rather than hours worked
• Have written contracts outlining the project
•  Have them bill you for their time instead of using a time clock
• Verify that they are working with multiple clients

Navigating Staffing Rules While Brewing Success

Breweries will use their combination of talent to make their brand come alive, but the ABC Test provided by California puts definite boundaries on the method of classifying the staff. Having good documentation, accurate payroll, and adequate onboarding not only kept to ensures that the breweries pay the correct taxes but also assists in creating stronger and more professional relationships with partners, thus operations are conducted effectively, and the focus is on producing quality beer.