Employers may believe that there is not a big difference between an employee and independent contractor. However, improperly classifying a worker as an independent contractor or vice versa can lead to serious and costly ramifications. Some employers may think that by labeling an employee as an independent contractor that is how they will be classified in the eyes of the law. The law is not quite that simple though.
Federal courts have offered guidance to assist businesses and employees establish their correct classifications under the Fair Labor Standards Act.
The Factors Used to Determine a Workers Classification
- What is the character and level of the supposed business’s control over the way that the work is to be completed?
- What is the supposed employee’s prospect for profiting or losing centered around on their own decision-making skills?
- Did the supposed employee use their own money to buy any equipment or supplies needed to accomplish their work?
- Did the services provided for the supposed employer necessitate any particular skills on the supposed employee’s role?
- What was the extent of the working association between the employer and worker? Was it thought to be permanent?
- To what degree did the supposed employee supply services that were a fundamental part of the supposed employer’s business?
The Fair Labor Standards Act
The Fair Labor Standards Act (FLSA) is not applicable to independent contractors. The FLSA is only applicable to workers with an employee classification. Employers often argue that employees are independent contractors to avoid paying the required minimum wage. Nevertheless, courts will analyze the above 6 factor test to determine the worker’s true classification.
Just because the employer and worker have a written contract specifying the worker as an independent contractor, does not by itself mean that the worker is an independent contractor. Courts will review the circumstances and details pertaining to each of the elements in every case.
When an employer controls such conditions like when the worker begins working, how many tasks he or she must perform and for how many hours he or she has to work, courts will generally consider the worker an employee.
On the other hand, when a worker has the freedom to choose his or her own schedule and hours, has control over the geographic region, maintains his or her own office and/or equipment, and has a special skill (such as a professional license), courts are more likely to classify a worker as an independent contractor.
Contact Our Elite West Palm Beach Law Firm
Our West Palm Beach employment & labor law lawyers can help you properly classify your workers as employees or independent contractors. If you need legal guidance on whether or not you improperly classified a worker, are experienced lawyers can analyze the factors to make the proper determination.
If you are an employer that is considering hiring or making any choices about workers classifications, it is important to hire a law firm that focuses on handling employment and labor related cases. The West Palm Beach labor & employment lawyers at Pincus & Currier LLP have over 100 years advising and serving our clients’ specific legal needs.
If you want topnotch legal advice, contact us online or call our office today at 561-868-1340, to discover more about how our employment & labor lawyers can assist your business in properly labeling its workers.