5 Ways to Determine Independent Contractor Classification
Attorney L. Reed Bloodworth, managing partner of Bloodworth Law is based in Orlando, Florida, with offices in Winter Haven. Reed discusses 5 ways to determine independent contractor classification in Florida.
Contractor? Needs Written Contract
#1: This seems obvious, but you’d be shocked at how often it doesn’t happen, if you want to call somebody a contractor, you have a contract with them in writing.
There are a lot of, quote, “independent contractors” out there with no written contract, and that’s about the most reckless thing you could do is not have a contract with a contractor.
A person that you retain to provide services to your business can be retained as an employee, or they can be retained as a contractor, but there are rules about what the effect of that is.
Employees Get Discrimination and Harassment Protection
#2: For example, employees are protected from discrimination and harassment.
Contractors are not.
Employee Pay and Overtime Requirements
#3: Employees have certain requirements with respect to minimum wage and overtime.
Contractors do not.
Workers’ Compensation is Different
#4: Employees have to be covered by workers’ compensation policy.
Contractors do not receive it.
Can’t Be Independent Contractor If…
#5: An employer’s default desire is always going to be to classify somebody as an independent contractor. To prevent that from happening, there are various laws that say that if this person does not meet certain requirements, you may not classify them as an independent contractor.
So if I hire an IT consultant to come into my business, and my IT consultant has his own LLC, and he works for 17 different companies, there are lots of different clients of which we are but one.
The IT guy is in business for himself, doing his own work, being an IT entrepreneur. He is properly classified as an independent contractor, with respect to my firm. But there are situations where that could be a lot more disputed.
Might Not Be a Contractor
For example, a Dog Trainer who works for a company is classified as an independent contractor but has no written contract. She works only for one firm. She has to wear the business uniform. She works established hours, sometimes works 12-hour days, and she is paid a daily rate of $180.
Not a Contractor If:
- No written contract
- Works for one firm
- Works set hours
- Wears business uniform
- Works 12-hour days
This could become a situation where the person should have been classified as an employee, and as a result, for those 12 hour days worked, was entitled to overtime compensation for the extra four hours worked.
Employers May Be Liable For Additional OT
As an employer, you want to make sure that those are delineations are correct between employee and contractor. Because if you screw it up, you’re liable for all the additional overtime. Let alone if the employee is bitten by a dog.
Regular Attorney Consultations
Consider holding regular consultations with an employment attorney to review your existing contractor policies and new rules put in place by your HR staff for your employees. This step can ensure you’re in compliance with Florida employment law.
Bloodworth Law serves as legal counsel for Florida businesses of all sizes across the state. Our Employment Law Team can work with you remotely, via Zoom, or in the office with safety measures taken to protect you as we help you with your legal issues.Consider sharing this post