Independent contractor, feeling like an employee - Will California&#39;s AB5 change my classification? I have been an independent contractor in California for a number of years with a business. Some of my tasks include graphic design, ad creation and management, search engine optimization, product research, marketing reports, hiring other contractors online. I don't know if I have a true job description, but as you can tell, my responsibilities are amorphous and can change when my boss feels like doing so, or when I feel like taking the lead on a new project. I signed an independent contracting agreement. I work less than 20hrs a week. I sometimes work from home, but my boss is clear that he wants me in the office as much as possible. We have a word-of-mouth agreement that I should clock 16hrs a week, minimum. My actual schedule is flexible and changes often. Over the years, I've worked with companies, to my boss' knowledge, but work with my boss has been consistent for years. I'm saying these details, because I have an inkling that soon, this job may not be classified as &quot;independent contracting&quot;. It's looking likely that California will pass a bill overhauling the meaning of independent contracting (emphasis added): The three-point test is simple enough that workers can apply it to themselves. An independent contractor, it says, must be free from a company’s control and direction. The work he or she does can’t be the company’s main business. And the contractor must be performing work that he or she does in an independently established trade. If even one of those statements is untrue, a worker must be classified as an employee, and is entitled to the benefits and protections that that status entails. The point that may be arguable is #3. Each skill I have could be an established trade that I could offer to another company. Traditionally, someone with a website would hire an independent contractor to do, say graphic design or copyrighting, or whatever. However, I'm doing a set of duties that together aren't classified as an independently established trade. Maybe there are certain tasks I do that invalidate this point. Am I reading too much into this? I do feel like an employee, given the wide scope of my duties.
No The intent of the proposed bill is to codify existing case law. You are an employee now and you will be an employee then. You are an employee now because a) you are not free from the company's control and direction or b) the work you are doing is the company's main business. If you read the bill you will find out that c) involves "an independently established trade, occupation, or business" so your business qualifies for this but you need to qualify for all three factors to be an independent contractor.
Yes One of the major factors that distinguishes a contract relationship from an employment relationship is the ability of the contractor to sub-contract.
First, Texas law requires the employer to give a written earnings statement to any employee which reports the rate of pay, the total amount of pay, deductions, and hours worked if the job is paid at an hourly rate. The law also says that an earnings statement may be in any form determined by the employer. Second, there is no law requiring there to be a single earnings statement or a combined statement, in case a person is paid at different rates, the requirement is simply that the information must be provided. It is legal to hire a person to work at different rates, as long as they have some mechanism for tracking what a person is doing. It is required that they pay you a different rate for working more than a certain number of hours, which will therefore be reflected in the earnings statement.
Is a text message legally binding? Yes, but the terms of the message need to be clear enough to ascertain the parties' intent at the formation of that contract or agreement. A contract does not even need to be in writing. There are also oral contracts and implied contracts, the latter referring to contracts which are inferred from the parties' conduct. A contract such as the agreement you describe here is binding regardless of its form. It is just easier to prove the existence of a contract if it is in writing. You did not specify your jurisdiction. If it is in the US, the price tag --rather than the downpayment-- of the object of the contract (i.e., the puppy you intend to buy) determines whether your complaint would need to be filed in Small Claims court. Generally speaking, parties to a dispute in Small Claims court have to represent themselves. Two remarks are pertinent. First, developing writing skills is utmost important not only for litigating a dispute, but also during the process of formulating the terms and conditions of a contract/agreement. Your post indicates that you seriously need to work on that. Second, the end of your post reflects that one of your managers violated labor law(s), which to most of us would be more worrisome than the controversy about the puppy. Legislation in most or all jurisdictions outlaws the act of withholding an employee's compensation regardless of its form (salary, commissions, and so forth). You might want to gain acquaintance with the labor laws of your jurisdiction so you can assess whether or how to proceed (does legislation require the employee to "exhaust administrative remedies" prior to filing in court? are administrative remedies optional? do these exist at all?), even if only to ascertain whether the deadline for filing the corresponding claim has elapsed.
tldr It depends on: whether the employment agreement specifies which state's law governs contract disputes; and how your state of residence and work treats governing-law clauses. Background To know whether § 2870(a) applies in this instance, a good place to start would be the employment agreement itself—contracts often contain a section on "Governing Law." This is an example of a choice-of-law problem, which is just preliminary procedural hurdle for a court to clear. Clearing the hurdle is usually easier for the court when the parties agree in advance about which state's laws will govern contract disputes. So, if the agreement says that California law governs, then one would typically look to statutes like § 2870(a) to interpret the agreement's provisions. But that's not always the definitive answer. Some states have laws designed to protect their residents by allowing them to void governing-law clauses that seek to have contract disputes adjudicated in a state where the employee doesn't live or work. Without knowing where you live, and in the interest of generality, let's use California residents as an example. Section 925(a) of California's labor code allows California resident workers to void governing-law clauses in employment agreements that deprive them of the protection of California's laws. But § 925(b) implies that the governing-law clause still controls unless that California resident worker affirmatively chooses to void the clause. Non-California employees would look to see whether their states have protective jurisdictional statutes like this. united-stateschoice-of-law
The real question isn't whether there is a law, but whether you want to keep your job. If you want to do something that you believe will affect your company negatively, and you ask whether it's legal or not, the question alone should show you it's a bad idea. And another question is whether you can be sued, and what it will cost you even if you can win a case, and the answers to that are "yes" and "a lot".
it depends There's Alice, who wants some service. There's Bob, who offers it. And there's C-Corp, which offers to connect people that seek service with those that offer it. The liability of C-Corp depends on many factors. Some that came up: Is Bob's service needing a license of sorts? C-Corp might be liable if they were warned that Bob lacks such or C-Corp represented that Bob had the license but did not. Is C-Corp getting a fee for referral/payment services only or do they manage or contract with Bob in some way or another? If C-Corp manages Bob or has a work contract with them, they might be akin to a Builder that hires various contractors and who is liable to the buyer of the building and to whom the contractors owe liability for their work. If they just provide the connecting and payment service, that's not as easy, but they still might be liable to some degree. What does the contract say? If they only provide a listing service like LinkedIn and specifically disclaim and point out that all listings are the contractor's making, they might be totally immune and have no liability.
I've litigated cases like these before. The IRS enforcement reaction is swift and severe. Penalties for the employer are heavy and rarely waived. It would be rare for a business like this to stay operational long enough to issue a W-2. A business like this would probably be shut down by the IRS and have the people responsible for the payroll function, at a minimum, promptly burdened with tax liens, within four to six months. These cases also constitute a significant share of all criminal tax prosecutions. The odds of someone doing this spending several years in federal prison is high. Generally speaking, if the wrongdoing is fully on the part of the employer without the collusion or knowledge of the employee, the IRS will not force the employee to double pay the taxes that should have been withheld by the employer in this situation. Instead, this IRS will try to recover the amounts that were withheld from the employees but not delivered to the IRS. It will seek to recover these amounts from the employer and also from other responsible persons in the organization (and from outsourced professionals) with the authority to pay the IRS who did not do so. There may be circumstances, if push comes to shove, where the IRS could collect from the employees in a case like this one (I've never had occasion to need to research that issue), but that would be the rare exception and not the rule, in practice. On the other hand, if the employer simply does not withhold taxes or prepare W-2s at all, and either 1099s people who should have been classified as employees (or files no information tax returns at all), the IRS will generally insist that the employee pay income taxes on the full amount owed and that they pay the employee part of payroll taxes. It will also pursue the employer for the employer's share of payroll taxes. The employer will also be jointly and severally liable for any taxes that should have been reported and subjected to withholding that are not paid by the employee (perhaps because the employee spent all the money). Sometimes cases like this are also criminally prosecuted, but it is less common to do so.