12 Mar What’s an independent contractor?
What’s an independent contractor? Put simply, someone that does work for an employer, but is not an employee. Unlike employees, who have an employment contract with their employers, independent contractors are not technically part of the company or organization for which they’re doing work. Instead, they simply have a contract in which they agree to do certain work for that company or organization.
Presumption against independent contractor status
California law presumes that if you’re working for somebody, you are an employee. Accordingly, the employer bears the burden to prove that you are not an employee. Even if your contract says you’re an independent contractor, that doesn’t mean you’re properly classified as an independent contractor. Courts consider a number of factors in determining whether someone is an independent contractor or an employee. If most of the factors show someone is an employee, they are legally an employee, regardless of what the contract says.
What’s an independent contractor? The main factor is level of control
Courts look at many factors, but level of control is the main factor. In other words, what’s the extent of the employer’s right to control the manner and means of the employee’s performance? If the employer exercises control over the person in terms of the manner and means of performing their job, then they are more likely an employee as opposed to an independent contractor.
For example, if you hire an electrician to rewire your house, you’re probably not micromanaging their work. You tell them what you want done, but you don’t tell them what tools to use or how to manage their time. This type of relationship is typically not employer-employee. Conversely, if a company hires someone and tells them when and where to be during work hours, what they should be doing, and how to do it, he’s probably an employee.
Nature and length of the relationship
Some of the other factors to consider are whether the hiring entity can terminate the employment relationship at will. If they can, this suggests it’s an employer-employee relationship.
Also, whether the worker is engaging in an occupation or business that is distinct from the employer’s business or occupation. For example, say a law firm hires somebody to do IT work for it here and there. That is a distinct business from the employer (meaning the law firm’s business). This would probably favor characterizing the IT person as an independent contractor. Conversely, suppose you’re a salesperson at a shoe store. Their business is selling shoes and your job is selling shoes. That your job is a core part of their business makes it more likely that you’re an employee.
Courts also consider the length of time over which someone performs the work. If you hire someone for a few hours of work, they’re probably not an employee. But if you hire someone to do that same thing every day for a year, that’s different.
The worker’s authority also comes up. If you can hire and fire others, then you’re probably an employee. Another issue to consider is how the employer pays. Do they pay an hourly rate? A regularly salary? Or per job? For example, take that IT professional. If she’s paid for each computer that she sets up, this might favor being characterized as an independent contractor. Conversely, if the law firm paid her a certain amount every month to run their IT, that would make it more likely that she is an employee.
Type of work and skill involved
There’s also the worker’s skill. If you’re an IT professional and you’re coming in and setting up a computer for a business you’re likely an independent contractor. That’s because you’re likely doing it without any supervision or direction by the company that has hired you.
Another factor is the skill that’s required to perform the work. Also, whether the business provides the instrumentalities, tools, and place of work. For instance, if you do landscaping or cleaning services, and you bring your own cleaning or landscaping tools, and you do it at the hirer’s residence or place of business, then you might be considered an independent contractor.
If a contract says you’re independent contract, it doesn’t necessarily mean you are. But courts will consider that. If the parties believe they are creating an employment relationship, or if they believe they are creating an independent contractor relationship, then that fact is also used in determining whether you should be an independent contractor or an employee.
If you believe that your employer has wrongfully classified you as an independent contractor, contact the Khadder Law Firm today for a free initial consultation.