Independent Contractor or Employee

Today’s competitive environment compels employers to find ways to reduce labor costs and increase operational flexibility. Many employers have opted for hiring “independent contractors” instead of traditional employees. Unfortunately, many employers misclassify employees as independent contractors when, in fact, they are true employees. Governmental agencies are aware of this tactic and closely scrutinize these relationships. Many employers also erroneously believe that they can avoid liability for employee claims if they contract for workers through a temporary service or leasing agency. Unless the relationship between the parties is carefully structured, however, employer obligations and liabilities are not escaped.