From Career Addict, Andre Smith shares his story as an independent contractor/freelancer and how the labor department concluded that he was an employee instead of an independent contractor. Andre writes:
“To make matters more intriguing, while it looked irrevocably like I was a freelance worker working from my home, when the job abruptly ended the Labor Department ruled that I was a company employee and so therefore, entitled to unemployment benefits.
How can this be? How can a worker in his own private orbit hundreds of miles from the company offices be considered an employee of the company, rather than an independent?
Now, let’s twist the knife a little more: Not only did I work from home, never set foot in the company’s offices and got sent a 1099 tax form every year – all of which are consistent with working as a freelancer – I also signed a contract two months into my job that declared I was a freelance worker.
Still, that was all overruled by the Labor Department. And, when the ruling was made, it meant huge trouble for my former employer who owes the government taxes they never withheld, social security and workman’s compensation payments they never made – and they owed all this on my behalf and for dozens of other employees the company had misclassified along the way.
The company owes the government tens and maybe hundreds of thousands of dollars.
Looking at a knowledgeable source, Flexjobs.com lists the most popular current freelance jobs including marketing consultant, project manager, Web site developer, writer, accountant, insurance appraiser, teacher, social media manager, graphics designer and administrative assistants. But the ramifications also apply to any other job that is done by contract, from construction workers who have their own tools and sign contracts to work project to project, to photographers who go wedding to wedding to make their living.
You can see where the money adds up. Does a construction worker pay for his or her own insurance or does the company? Does a wedding photographer contribute to workman’s compensation? After all, even wedding photographers can get hurt on the job.
While it seems odd, the litmus test for determining whether or not you are a freelance worker or an employee is simply this: If it looks like a duck and walks like a duck, it is probably a duck. That means, having feathers or webbed feet or walking with a waddle do not define the issue. In other words, no one factor declares it is a duck. You could have feathers, waddle and have webbed feet and not be a duck at all.
In more legal terms, here is the phrasing of the same idea in the judgment of my case: “The determination ‘is a question of fact: No one factor [is] determinative; and an employment relationship [can] be found even if the other evidence in the record [supports] a contrary conclusion.’”…”
Andre says that the labor department ruled he was an employee and entitled to unemployment benefits. His statement suggests that he applied for unemployment benefits which got the labor department involved. One of the most common ways that the question of the classification of a worker as an employee or independent contractor arises is when a worker files an claim for unemployment benefits.
Read the full sotry at Do You Really Work For Yourself?.