From the National Law Review, Luis E. Avila writes about frequent challenges to start-ups when they are adding additional workers. He outlines some of the landmines to avoid when hiring employees, interns and, of course, independent contractors. He writes:
Start-ups often want to avoid all the requirements that come with hiring and employing employees and instead opt for an independent contractor relationship. However, in practice, the company will often treat the contractor no differently than an employee. Employers must be mindful that treating a contractor like an employee could create an employer/employee relationship, regardless of the parties’ intentions.
A few things to keep in mind to maintain an independent contractor relationship: 1) The company should not control, or have the right to control, what the worker does or how the worker performs his or her job; 2) The company should not control the business aspects of the worker’s job (such as providing tools/supplies for performing the work, determining whether and what expenses are reimbursed, etc.); 3) The parties should execute a written contract that expressly states the relationship is one of an independent contractor; 4) The Company should not provide the same benefits (such as vacation, health insurance, etc.) to the contractor as it does to its employees; 5) Typically an independent contractor is hired for a specific project, not a continuing relationship, and does not perform key aspects of the business….”
Read the full story at Adding Talent to Your Startup – Common Pitfalls to Avoid