When most people think of the relationship between an employer and a worker, they envision something like the archetypical employee. The worker goes into the place where they’re employed, works however long they’re scheduled to work, and goes home at the end of the day. However, some workers aren’t employees, but are instead independent contractors, and things work a little differently for them.
Independent contractors are a kind of worker who works for an employer, or provides an employer with services, without technically being an employee. Independent contractors can include people like plumbers or electricians who are only hired out on a contract basis, or it can include temp workers, graphic designers, and even more traditional kinds of workers. In theory, nearly any position could be managed as an independent contractor, although it’s rare to see them at the managerial level.
The primary distinction, legally speaking, between an employee and an independent contractor is the amount of control the employer has over the worker. The more control an employer exercises over the worker, the more likely they are to be considered an employee. Conversely, the more freedom an employee has, the more likely they are to be considered an independent contractor. While there’s no one thing that differentiates the two, if a worker’s status is in question, there are a variety of factors that will be taken into consideration to determine whether they qualify as an independent contractor or an employee.
And the distinction is important for several reasons. First, every employer has certain obligations to their employees, such as withholding Social Security taxes and workers’ compensation insurance, that they don’t have for independent contractors. Additionally, employers are much more likely to be held liable for an employee’s tortious acts than an independent contractor’s misdeeds. Also, because independent contractors don’t have their Social Security taxes withheld, they need to pay those taxes at the end of the year. In some cases, people who thought they were considered employees found themselves shocked to realize they’d been classified as independent contractors, resulting in them owing thousands to the IRS.
If you are in a dispute with your employer over your employment status or want to protect your rights as an employee or independent contractor, give the Law Offices of Steven Sack a call. Steven Mitchell Sack, the Employee’s Lawyer, is a New York employment lawyer who has considerable experience in handling the many aspects of employment law, including overtime, tips and gratuities, minimum wage, unemployment benefits, and disability matters. To schedule a consultation with New York City employment lawyer Steve Mitchell Sack, call (917) 371-8000.