Tennessee Real Estate License Exam Practice Question
Licensee A and Licensee B work for a principal broker for ABC Realty. For licensee A, the principle broker supervises the work as a listing/buyer's agent, collects commissions, and pays out based on their commission split agreement. Licensee A works from home and attends training meetings at the office. Licensee B works 8 a.m. to 4 p.m. in the ABC Realty office for relocations, showing local properties to relocating clients. Licensee B is licensed to show homes and submits offers for purchase from individuals who are relocating but is paid by salary based on hours worked, with a bonus for production. What are Licensee A and B's relationships with ABC Realty?
Correct Answer: B
Rationale: Licensee A operates under a commission split agreement and is supervised by the principal broker, indicating an independent contractor relationship. This is typical for agents who work flexibly, like from home, while still being subject to oversight. In contrast, Licensee B works set hours in the office, receives a salary, and has a bonus structure, which aligns with an employee relationship.
Options A and C incorrectly classify Licensee A as an employee, which doesn't fit the independent nature of their work. Option D mischaracterizes both as employees, overlooking Licensee A's contractor status.
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