TAX TIME! Is it really better to be a contractor?
Is your employer claiming you are an independent contractor? Have you been told you are not entitled to any benefits, workers compensation coverage or overtime pay because you are an independent contractor? There are actually legal classifications for who is and is not a proper contractor your company cannot just use this as a way to avoid paying proper employment taxes and the like.
Still many employers, whether they know the law and do it anyway, or are not aware of the guidelines use the differentiation of employee from contractor to get around the cost of paying proper fees such as:
- payroll taxes
- minimum wage and/or overtime requirements
- paid and unpaid rest or break periods
- reimbursing business expenses
- workers compensation coverage
- Unemployment, disability or Social Security taxes and payments.
The number one reason employers claim you are an independent contractor? It’s cheaper for them. Sure, it also means you can write off all of your expenses, but is it really worth it? Those may in fact be THEIR expenses and why should you be paying to run their business all the while being left totally unprotected. Contractors don’t have coverage for workers compensation or unemployment benefits. That means unless you are paying for it on your own, if you are injured on the job you are on your own and many insurance companies will deny your claim saying you should be covered by workers comp for a “work related injury.”
The Division of Labor Standards Enforcement (DLSE) sets out the guidelines for who can and cannot be claimed as an independent contractor.
- You perform a service that is outside the norm for the business employing you, such as marketing specialist for a home builder.
- Your work could be defined as a specialized skill.
- You were hired to complete a well defined task only to completion and not offered an actual position with the company.
- You have no supervision, but were given a specific job to complete and are to do so on your own and how you see fit.
If you have been deemed a contractor rather than employee by your company, but these do not define your actual duties then you have likely been misclassified, you need to speak with an employment attorney right away who can determine what you may be owed in compensation.
You only have a short amount of time to file any claim having to do with you employment, call United Employees Law Group today before you file the wrong tax return.