If I hire independent contractors or employees, and the job requires living on site, does the job create a rental agreement too?

I plan on hiring a person--either an independent contractor or employee, I haven't decided which makes the most sense yet--for a job that will likely take several months but in any case under one year to perform. This job will require living on the site where the work shall be performed; i.e. room and board are provided and included in consideration for the work, in addition to wages. Does living on site and providing of room and board create a rental agreement as well, and all the attendant disclosures and obligations under California and federal law? (E.g., lead disclosure, Megan's law, pest control, asbestos.) Or is the agreement still considered an employment or independent contractor agreement without the need to make the aforementioned disclosures as found in rental agreements?

Los Angeles, CA -

Attorney Answers (2)

James Carl Eschen III

James Carl Eschen III

Employment / Labor Attorney - Santa Cruz, CA

Yes and no. An employee or independent contractor who receives housing is considered a tenant for most purposes during the tenancy. The property owner, for example, has an obligation to provide the resident with a habitable dwelling. I could not tell you whether specific laws like Megan's law apply to employees, but prudence would suggest that for those purposes you treat the employee as a tenant.

The rule is different when the employment ends. When an employee receives housing as part of employment, the employee's right to the housing ends when the employment ends. You would not have to give the employee 30-days or any other notice, although if the employee did not leave right away you would still have to bring an unlawful-detainer action.

Whether the same rule applies to an independent contractor is not clear. Most likely, anyone working for you who had to live on the property would not be an independent contractor, anyway.

Neil Pedersen

Neil Pedersen

Employment / Labor Attorney - Irvine, CA

In addition to the accurate information already provided by my colleague, I wanted to warn you that the IWC Wage Order for your industry has a table of the value for room and board you are allowed as credit toward the minimum wage, and the requirements for allowing such credits (like a written agreement).

Good luck to you.

This answer should not be construed to create any attorney-client relationship. Such a relationship can be formed... more

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