New Jersey Real Estate Exam Practice Question
Licensee A and Licensee B work for a principal broker for ABC Realty. For licensee A, the principal 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 independently, working from home and receiving commission-based pay, which aligns with the characteristics of a contractor. In contrast, Licensee B has a set schedule, works directly in the office, and receives a salary with bonuses, indicating an employee status.
Option A incorrectly categorizes Licensee A as an employee, which contradicts their commission-based compensation and independent work style. Option C misclassifies both as contractors, overlooking Licensee B’s structured employment arrangement. Option D fails to recognize Licensee A’s independent contractor status, as their compensation model does not fit employee criteria.
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