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Independent contractor or employee: an important consideration

On Behalf of | Nov 16, 2020 | Federal Employment Law

An online overview of one key aspect relevant to the employment relationship makes a quick preliminary point.

“Under federal law,” it notes, “a worker is either an employee or independent contractor.”

Is that an important distinction?

It certainly can be and, in fact, issues surrounding that either-or designation have spelled top-tier concerns for courts in recent years.

What exactly is an independent contractor?

Some readers might have guessed that this is coming: The above header query links to no easy answer. The above overview underscores that there “is no single rule or test for determining whether individuals are employees or independent contractors.”

There is a rough litmus test, though, and it revolves around control. Specifically, a fairly accurate gauging of worker status can be made by examination of how much control an employer has over the work being done by an individual.

There is a flip-side and reciprocal way of looking at that, which can be duly considered by posing this question: How much independence does an individual have in going about his or her work?
Courts will delve into a host of factors in weighing employment status, including these:

  • Duration of the work relationship (permanent versus temporary)
  • Source of worker tools and resources (employer-supplied or owned by worker?)
  • Degree to which work is deemed part of core business operations
  • Work schedule (defined by flexibility or regular hours?)
  • Required on-site attendance versus latitude to work from work
  • Isolation from employees versus regular interaction

Why classification can be an important concern

There is a growing trend in the American business realm to classify workers as independent contractors, sometimes for an improper purpose that benefits employers and simultaneously harms those providing labor.

Here’s why: An independent contractor designation can spare an employer from performing duties that it customarily owes to its employees. Those range widely from making workers’ compensation payments and providing health coverage to paying bonuses/overtime, approving vacation time and safeguarding additional benefits.

A federal worker with questions or concerns regarding employment status can turn for guidance and proven representation to an experienced employment law legal team.


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