Friday, May 30, 2014

Can the Boss Man Do that? What are My Rights?

Can the Boss Man Do that? What are My Rights?

Sadly, independent contractors have few rights aside from being paid what they were promised. However, many workers who are called independent contractors are really employees, and as such deserve to have the rights of employees.

If you're getting a 1099 tax statement rather than a W-2 and don't have taxes taken out of your check, you're being treated as an independent contractor.

When you're not being treated as an employee, you lose advantages and protections such as rights to overtime pay, rights to minimum wage, rights to Workers' Compensation, rights to unemployment insurance, protection against discrimination, right to union protection, and employer contribution to social security.

How do you determine whether you should be treated as an employee or a independent contractor? Well, there are two main tests used to decide what your status should be. The Internal Revenue Service uses a "right to control test". The Fair Labor Standards Act (FLSA) uses an "economic reality test". The answers of BOTH tests are evaluated together to determine a worker's status. No one test decides the outcome either way.

If you believe your boss is wrong to treat you as an independent contractor, you can obtain advice from a Worker center or contact the Department of Labor. If you're wanting unemployment benefits, an IRS determination is usually accepted in most states. When you file the SS-8 form with the IRS you should get a decision in six weeks.

It's also a good idea to see if your particular state uses their own test to decide who can be classified as an independent contractor.

- What is the Walsh Healy Act and How Does it Affect Employers? - Do Your Employee's Wages Violate the Law? - Six Ways the Affordable Care Act Could Cost Federal Contractors More


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  2. I had no idea that independent contractors get mistreated so often. They lose out on so many benefits that regular employees get. My husband is looking into being an independent contractor, but maybe we will have to reevaluate our options. Thanks for the information.

    Brooke Bowen |