Employee or Independent Contractor: Why It Matters

From HVACR Business — Christopher Boman and Boris Sorsher of Fisher Y Phillips, LLP discuss the importance of properly classifying workers as employees or independent contractors that that the “failure to properly classify can subject the employer to administrative enforcement actions, civil penalties, fines, unpaid wages, class action and representative action lawsuits, and the assessment of back taxes and premium payments and related penalties.”

Mr. Boman and Mr. Sorsher report that while there are a number of different test for determining if a worker is really an independent contractor, there are common themes.  First, all the tests try to determine if a worker is truly independent; second, all the tests agree that a contract is evidence but doesn’t definitively determine if a worker is an independent contractor; and third, all the tests evaluate the amount of control the company has over the workers.

The authors identify questions that are useful (but which will not on their own make a determination):

  • Does the employer control how, where and when the person performs the job?
  • Who provides the tools and materials?
  • The length of the job?
  • How are they paid?
  • Is the worker working elsewhere?
  • Did the worker and the company enter into a written agreement?
  • Can the worker terminate the job at any time?
  • Is it possible for the worker to lose money on the project?
  • Is there mandaotry training?

Mr. Boman and Mr. Sorsher discuss each of these questions and provide excellent initial guidance on the proper classification of workers as employees or independent contractors.  As always, this “list of questions is not exhaustive and cannot substitute for the guidance of a skilled employment law attorney…”

Read the full story at Employee or Independent Contractor:  Why It Matters starting on page 10

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