Are You An Employee or Independent Contractor?

Are You An Employee or Independent Contractor?

Nov 03

In order to save money and avoid paying overtime wages, employers utilize a wide range of tactics and one of them is identifying employees as an independent contractor. By employing such tactics, companies may be depriving their employees of the benefits and wages they deserve. Classifying an employee as an independent contractor is a violation of the Fair Labor Standards Act (FLSA). According to the website of Leichter Law Firm, employees who have been classified as an independent contractor has the right to recover unpaid overtime wages.

Knowing the difference between independent contractor and employee is an important step in winning your unpaid overtime claim. First of all, an employee directly works for a company or another person and answers to an employer or manager. For this reason, they get their income from their employer. On the other hand, an independent contractor is considered “self-employed” by the IRS.

In terms of control, it is the employer who determines the conditions of work and directly controls the actions of an employee. The employer has the right to hire and terminate an employee. Meanwhile, depending on working conditions, an independent contractor has more control over their work and the manner, time, and location where it is produced. In terms of rate of pay, the income of an employee is determined by their employer. The independent contractor sets their own pay rate.

The IRS and some states have certain laws that help define an independent contractor. The main focus of these laws is on the level of control an employer has over a service or product. So if your working hours is determined by a company, you are likely to be an employee. On the other hand, if you work on a flexible schedule, you are an independent contractor.

It is important to know these differences so that you can recover the wages you deserve for working beyond your regular working hours. Your right to be paid for overtime work is protected under the law so fight for it.