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Employment is a relationship between two parties, usually based on a wage contract, where one party, which can be a commercial corporation, profit, non-profit organization, cooperative, or other legal entity, is the employer and the other is the employee. Employees work for remuneration, which can be in the form of hourly, piecework or annual salary, depending on the type of work that the employee does or in which sector they are working in. Employees in specific areas or sectors may receive grants, bonuses, or stock options. In some types of employment, employees may receive benefits in addition to pay. Benefits may include health insurance, housing, disability insurance, or use of a gym. Work is usually regulated by labor laws, organizational or legal contracts.

An employee contributes to the work and experience of the employer or person running a business or enterprise (PCB) and is usually hired to perform specific duties that are intended for the job. In a corporate context, an employee is a person who is hired to provide services to the company on a regular basis in exchange for compensation and who does not provide these services as part of an independent business.

A problem that arises in most companies, especially those that are in the gig of the economy, is the classification of workers. A lot of workers that fulfill gigs are often hired as independent contractors.

As a general principle of US employment law, there is a difference between an agent and an independent contractor. The default employee status is employee unless specific instructions are followed, which can be determined using the ABC test. Thus, clarifying whether someone who performs, doing the work is an independent contractor or employee from the beginning, and treating them accordingly, can save the company from further trouble.

Depending on key circumstances, including regular pay for an employee, adherence to certain hours of work, is supplied with tools by the employer, close supervision by the employer acting on behalf of the employer, working for only one employer at a time, they are considered an employee, and the employer is usually responsible for their actions and is obliged to compensate them. To remain protected and to avoid legal action, the employer must be aware of this distinction. Oversight by employer and management in an organization is multi-layered and important for both staff and productivity, as control is the fundamental link between desired outcomes and actual processes. Employers must balance interests, such as lowering wage restrictions by maximizing productivity, in order to achieve profitable and productive employment relationships.

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