Know the difference between employees and independent contractors

Many employment issues hinge on the classification of an employee. In some cases, employers might try to claim that someone is an independent contractor instead of an employee in order to avoid having to address certain matters. Understand the difference so that you can ensure that you are classified correctly.

Control of the person

One of the big differences between an employee and an independent contractor is that companies have more control over employees than they do independent contractors. Typically, employees are told when and where to work. They are told specifics about how to do the job. Employees might also be told what to wear while they are working.

Generally, these statements don't apply to independent contractors. An independent contractor is his or her own boss. This individual will set one's own hours and won't have training or much direction about work duties from the company with which he or she is contracted. In most cases, independent contractors are bound by delivery terms in the contract but that is likely the scope of the control.

Presence of benefits

Anyone who is provided with employment benefits should usually be considered an employee. It is highly unlikely that a company would provide benefits, such as health insurance and paid time off, to an independent contractor. In some cases, benefits might be provided to a non-employee when the conditions of those benefits are covered in the project contract.

Payroll considerations

Another big difference between these two classifications is that employees will receive a paycheck that has taxes taken out of it. Independent contractors will receive the entire agreed upon pay for a project. The independent contractor is responsible for paying his or her own taxes. Employees are generally paid on the employer's schedule and might have other employment terms, such as a non-compete agreement, that are in place to govern the working relationship.

Because the IRS usually classifies workers as employees, companies might ask people who are hired as independent contractors to sign something that verifies their classification. If you are asked to sign one of these documents, make sure that you understand what it means. It could mean that you are giving up some rights of employees, which isn't usually a big deal. However, if you are being treated as an employee, you need to ensure you are reaping the benefits of that relationship.

No Comments

Leave a comment
Comment Information
Free Consultation

Get Started With Your Free, No-Obligation Consultation

Let us be clear when we say "you pay us nothing unless we win." Your relationship with our law firm begins with a free consultation. You meet directly with one of our experienced lawyers. When you become our client, we never ask you to open your checkbook. We work on a contingency-fee basis, which means our fee only comes from the proceeds from a successful verdict or settlement.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

McCune Zenner Happell, PLLC The Parklane Building, 5200 Maryland Way Suite 120 Brentwood, TN 37027 Phone: 615-953-8337 Phone: 615-425-3476 Fax: 615-251-6958 Brentwood Law Office Map

  • The National Trial Lawyers Top 100 Trial Lawyers
  • Super Lawyers
  • The Best Lawyers in America
  • Best Lawyers Best Law Firms U S News
  • Nation's Premier NAFBA Top Ten Ranking 2014