Employer-Employee Relationship and Compensation Income

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Questions and Answers

Which of the following best defines an employer according to the given text?

Any individual engaged in a screening process for hiring employees

Any individual who receives wages

An officer of a corporation

Any person for whom an individual performs service as an employee (correct)

Who among the following is NOT considered an employee based on the given text?

Individuals receiving wages

Talents and artists on TV shows or radio broadcasts

Officers of a corporation (correct)

Consultants

What is a key element of the employer-employee relationship as per the given text?

Talents and artists on TV shows or radio broadcasts

Individuals receiving wages

Consultants and directors without management function

Power to control the employee on the means and methods by which the work is accomplished (correct)

Who has the power to retrench or terminate an employee for just or authorized causes?

Employer Signup and view all the answers

What distinguishes an employer-employee relationship from an independent contract for the provision of services according to the text?

Selection and engagement of employees Signup and view all the answers

What type of arrangement is not considered an employer-employee relationship according to the given text?

An independent contract for the provision of services Signup and view all the answers

Which type of employees are those who effectively recommend managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment?

Supervisory employees Signup and view all the answers

What type of employees are exempt from income tax on their compensation?

Minimum wage earners Signup and view all the answers

What does gross compensation income generally include?

Only remunerations received under an employer-employee relationship Signup and view all the answers

Which of the following is considered as non-taxable compensation?

Exempt benefits under the NIRC and special laws Signup and view all the answers

What does exempt benefits under the NIRC and special laws include?

Retirement benefits under RA 7641 Signup and view all the answers

Who are eligible for COVID-19 benefits under RA 11494 (BAYANIHAN 2)?

Health workers who have contracted COVID-19 in the line of duty Signup and view all the answers

What does minimum wage earner refer to?

An employee paid the minimum wage as set by statutory regulations Signup and view all the answers

Study Notes

Employer and Employee Relationships

An employer is defined as any person, corporation, partnership, or entity that exercises control over the payment of wages and has the power to hire, discharge, and supervise employees.

Employee Classification

Not considered an employee: a person who works independently and is not subject to the control of the employer.

Employer-Employee Relationship

A key element is the exercise of control by the employer over the employee.

Termination of Employment

The employer has the power to retrench or terminate an employee for just or authorized causes.

Employer-Employee vs. Independent Contract

The key distinguishing factor is the employer's control over the employee; an independent contractor has more autonomy.

Employer-Employee Relationship Exclusion

An arrangement where the worker is not subject to the control of the employer is not considered an employer-employee relationship.

Managerial Employees

Those who have the authority to recommend managerial actions and exercise independent judgment are considered managerial employees.

Tax Exemptions

Certain employees are exempt from income tax on their compensation, such as minimum wage earners.

Gross Compensation Income

Generally includes all earnings, including bonuses, overtime pay, and commissions.

Non-Taxable Compensation

Certain benefits, such as meal allowances, are considered non-taxable compensation.

Exempt Benefits

Include benefits under the National Internal Revenue Code (NIRC) and special laws, such as those related to health insurance.

COVID-19 Benefits

Eligible individuals for COVID-19 benefits under RA 11494 (BAYANIHAN 2) include those who meet specific criteria.

Minimum Wage Earner

Refers to an employee who receives the lowest wage permitted by law.

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Description

Test your knowledge of the employer-employee relationship and compensation income. This quiz covers the elements of employer-employee relationship, classifications of employees, and the definition of compensation income.