Colibri Real Estate Practice Exam

In the real estate context, the primary distinction between an independent contractor and an employee revolves around the degree of control and autonomy each has in their working relationship. Independent contractors operate under their own license, which means they are responsible for their own business activities and compliance with regulations. This autonomy allows them to set their own hours and determine how they will conduct their business, including the marketing strategies they employ and how they interact with clients.

This characteristic of independence is crucial as it signifies that independent contractors are not under direct supervision by a broker or firm, allowing them to manage their workload and time according to their preferences. This level of control over their work environment and schedule is typically not afforded to employees, who often have set working hours, are subject to more direct oversight, and do not operate under their own license independently.

Understanding this distinction is essential for real estate professionals as it affects legal responsibilities, tax implications, and the nature of the working relationship with a broker or firm.