Classifying Independent Contractors and Employees 

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From JDsupra, Steven Smith discusses the risks of misclassifying workers, the standards for classification and offers some great recommendations for staying out of trouble.  Steven writes:

Best Practices to Avoid Misclassification Claims

  • Given the potential risk of misclassification, there are some steps companies can take to avoid misclassifying:
  • Draft detailed job descriptions for all positions, including roles filled by independent contractors.
  • Avoiding having independent contractors do the same or similar work as employees.
  • Do not provide independent contractors with supplies, tools or equipment.
  • Do not reimburse independent contractors for work-related expenses.
  • Be willing to give up some control. If you treat them like employees, they will be considered your employees.
  • Compensate independent contractors on a per-job basis rather than by hour or by week, and invoice them.
  • Fully discuss the nature of the relationship with prospective independent contractors, and reduce the understanding to writing.
  • Avoid the outward appearance of an employment relationship (company email address, company phone, etc.).
  • Regularly review the nature of the relationship, and reclassify workers as needed.

Source: Classifying Independent Contractors and Employees – The $100 Million Question | Buchanan Ingersoll & Rooney PC – JDSupra

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