A New York appeals court recently ruled that workers who unloaded instruments and equipment for touring musicians were independent contractors, not employees. The music management company who put on the concerts hired an independent trucking company to carry the musicians’ gear. The company viewed both the musicians as well as the loaders as independent contractors. However, the state Department of Labor determined both groups were employees, and the case was battled through the courts.

Ultimately, the court found that the musicians were employees, but the loaders were independent contractors. The music management company was found to exercise enough discretion, supervision, and control over the musicians for them to be considered to be employees. The company had the right to fire the musicians for drug and alcohol abuse. They were paid a flat fee per week during the tour, while the music company paid for their expenses. However, the loaders were not controlled by the music management company, which means they were independent contractors. Instead, the loaders were paid to unload the instruments and equipment, but weren’t given any directions or supervision.

Whether a worker is an independent contractor or an employee can make a huge difference to both the employer and the worker in several respects. First, if a worker is an employee, employers must pay state and federal unemployment tax, social security tax, and workers’ compensation premiums to an insurance fund. If a worker is an independent contractor, the employer doesn’t have to make any of those payments. Also, if a worker is an independent contractor, the employer must withhold state and federal taxes, while an independent contractor is responsible for those payments.

In addition, independent contractors lose many of the legal protections afforded to employees. For example, since federal law requires employers to provide employees with health insurance if certain conditions are met, using independent contractors would be a way around that requirement. Also, independent contractors are not entitled to benefits like maternity leave, sick leave, or vacation time to which employees may be entitled.

As you can see, it’s generally in the employer’s best interests to classify a worker as an independent contractor rather than an employee. However, the rules regarding whether a worker is an independent contractor or an employee must be met. In order for a person to be an independent contractor, generally the worker must have a great deal of control over how the job is done. Some factors courts will consider when evaluating whether a worker is an independent contractor or an employee include:

–          Whether the worker supplies his or her own tools and equipment,

–          If the worker can be discharged any time and whether the worker can choose not to come to work without fear of losing employment,

–          If the work is temporary or permanent,

–          If the worker can control the hours of employment,

–          Whether or not the work is considered integral to the business, and

–          If the worker decides how the work is to be performed.

As you can see, it’s not always clear whether or not a worker is an employee or an independent contractor. At Liberty Law, Micha Star Liberty believes that companies should properly classify their workers, and if they don’t, they should be responsible for paying any damages.

If you believe you have been improperly categorized as an independent contractor, when you are actually an employee, call Micha Star Liberty, Oakland employment attorney, at 510-645-1000 or 415-896-1000. She works with clients throughout the Oakland- San Francisco area.

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