Our podcast explains the difference between an independent contractor and an employee. The courts and government agencies use many factors to determine independent contractor status. Calling someone an "independent contractor" does not make him/her an independent contractor in the legal sense. Mislabeling a worker as an independent contractor creates potential liability for employment taxes and penalties, and liability for failure to fulfill the many legal obligations owed to an employee, such as wage and hour requirements. For your own protection, make sure that a person working as an independent contractor truly meets the difficult tests required by law.

Listen to our podcast "Defining Independent Contractor vs. Employee" to understand the various tests the state and federal agencies use to determine if someone is an employee or independent contractor.