I'm starting a new sole proprietorship in California. I have an IT specialist who's agreed to provide his services (website coding) in exchange for a share in profits. He does not hold decision making rights or rights to assets. He works with his equipment on his own time, in a different country (Japan). He does not receive any guaranteed wage or salary. Also, he is working full-time with a different IT company.
Having no guarantee of pay, can he legally be considered a contractor?
Also, does this type of agreement open me up to some liability risks since I'm running a sole proprietorship (as opposed to an LLC or Corp)?