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Employee or Independent Contractor — Which is it?

Determining the differences between an employee and an independent contractor is crucial since workers receive different benefits depending on their classification. Although you might potentially earn the same pay as an employee if you are an independent contractor, there are a plethora of legal differences. For example, workplace or work-related injuries are covered by workers’ compensation insurance for employees. On the other hand, independent contractors are generally not covered by workers’ compensation insurance.

Below is a list of some more key differences between employees and independent contractors:

  • Employees are protected by employment laws: Employees are afforded a number of protections under federal and state labor and employment laws, such as anti-discrimination. Independent contractors are not protected by these laws.
  • Hiring practices for employees and independent contractors are often different: Prospective employees usually fill out an application that is given to the Human Resources department. In the event that one is selected for and accepts the job, the employer must also obtain personal information, such as marital status, date of birth, and citizenship status. An independent contractor typically corresponds with the department that is in need of their services and, if chosen for the job, he or she will enter into a contract.
  • Your tax documents will look different: Employees usually fill out a W-4, whereas an independent contractor must fill out a W-9 tax form.
  • Payment for services will differ: Employees and independent contractors are also paid differently. An employee either earns a salary is or has an hourly rate. An independent contractor is paid an amount, which could be daily, weekly, or hourly, when the task is finished.
  • Independent contractors are not eligible for company benefits: Many companies see a major benefit in hiring independent contractors instead of employees due to the fact that independent contractors are not eligible for benefits such as retirement plans, health insurance, or stock options.
  • Independent contractors are hired for a specific timeframe: An employee can potentially stay with a company for decades, until retirement. An independent contractor, however, is usually only hired to perform a specific job that will last a finite amount of time. Once the job is over, the independent contractor will submit an invoice and receive his or her payment for the completed work.

If you believe your employer is incorrectly classifying you, reach out to an employment law attorney to discuss your case.

Contact an Employment Law Attorney at The Smith Willis Firm for the Legal Advice You Need!

At The Smith Willis Firm, our team of employment law attorneys is experienced in handling a vast range of legal matters pertaining to legal law and is committed to helping clients navigate the complexities of their case, no matter how difficult it might be. With a history of success and extensive experience on our side, you can trust our ability to effectively represent you.

Contact our law firm today at (770) 766-5811 to schedule a free and confidential case evaluation with one of our trusted attorneys and learn more about how we can assist you.