One of the oldest tricks that many companies use to cut on their expenses is the wrong classification of their employees. For many decades, business owners and managers have managed to get away with this negligible but vital distinction which keeps them on the ‘safe’ side. Times have changed, and the modern employee is not only aware of their rights but has instant access to vital information thus making them better informed. It is very easy to know whether you have been rightly classified or not by going through the terms and conditions of the work agreement that you signed and analyzing your payment modules.
The most common form of workplace misclassification is to give a regular employee the tag of an independent contractor. Federal and state laws plus the Internal Revenue Service have clear regulations as to the conditions under which one must be rightfully hired as an independent contractor. Primarily, a third-party contractor hired by a company is given a specific scope of work within their expertise and allowed to pursue it to completion. The company in such instances loses the power to control how the contractor achieves the results with the only point of direct contact being on the financial support.
A commonly used way to evaluate whether one is an employee or not is the IRS criteria for distinguishing an employee from an independent contractor. The three main elements which are looked at are the behavioral association, financial agreements, and the type of relationship. Under behavioral association aspects such as the direct control of your input, provision of training for skill improvement, and where you are expected to report for your duties are considered. For the financial agreement, the mode of payments is considered and how tools or supplies are acquired. Finally is the type of relationship that you have with the company and this includes written contracts made before you were hired.
It is easy to miss the obvious signs that amount to violations of your rights in the work environment, and that is why you need professional assistance to see you through this sensitive issues. Ravi Sattiraju has been providing individuals in New Jersey with a new sense of hope by working in line with the law to correct the demeaning issues of worker misclassification. As legal attorneys, they have the expertise to look deeper into a matter that has seen the federal government raise red flags over the unfortunate loophole that a lot of employers wrongly use.
Numbers do not lie, and with over 3.4 million employees wrongly classified as independent contractors, it is high time you took a double look at your current situation. Seeking legal justice for misclassification works for your own good since you get a seal against all the losses incurred over the years. Among the main differences between an employee and an independent contractor include;
- Lack of overtime pay which only employees are entitled to for extra work hours
- No inclusion in employee benefits such as bonuses, paid vacations, and sick leaves
- There is no eligibility for worker’s compensation insurance
- Lack of a share on the company’s social security and Medicare taxes