Independent Contractor v. Employee?
San Jose Independent Contractor Claims Attorney
In Silicon Valley and other places, entrepreneurial spirit is alive and well. Many businesses and individuals do business together under an independent contractor arrangement. Although both parties (the business and the individual) may be content with that arrangement, under various laws the individual may actually be an employee, rather than an independent contractor. If that is the case, the business (employer) could be liable for a significant amount in overtime pay (if the employee worked overtime hours), taxes, and penalties. The employee could be losing benefits to which they are entitled under the law, such as Workers’ Compensation insurance protection provided by the employer, indemnification under Labor Code §2802, and overtime wages.
Becoming aware that the relationship is not legally an independent contractor arrangement often occurs when an individual’s relationship with the business ends in a manner where the individual is discontent or unhappy and explores claims against the business. When they see an attorney about their claims they often discover that they were actually an employee.
If a business or individual is unsure about whether they have formed an enforceable independent contractor arrangement or an employment arrangement, they should see an employment law attorney to help them make that determination because the consequences of not complying with the law can be significant.
Beginning in 2012, pursuant to California’s Labor Code §226.8, employers who willfully misclassify an individual as an independent contractor are subject to a penalty for each violation ranging from $5,000 to $15,000 and more if there is a pattern and practice of misclassifying individuals as independent contractors. See also related Labor Code §2753 for advisor liability.
Contact Our Attorneys To Understand The Difference Between Independent Contractors And Employees And What To Do In Your Situation
The decision to hire or work as an independent contractor should be weighed carefully. Properly distinguishing between employees and independent contractors has important consequences, and the failure to maintain the distinction can be costly.
Our skilled San Jose lawyers have addressed these issues in the Bay Area for the last two decades. If you have an independent contractor concern, please contact Habbu & Park of the Bay Area for answers to your questions.