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Does it Matter if I’m an Independent Contractor?

Workers’ compensation law draws a very important distinction between “employees” and “contractors” that many of us never think about.  As long as someone’s paying you to do a job, does it really matter if you’re classified as one or the other?

Yes.

Under New York law, workers’ compensation benefits only pay for injuries to employees – not to contractors.  This means that if you’re injured on the job and you are simply a contractor, you may be out of luck in terms of recovering from your boss.

When looking at the classification, the courts and administrative hearing officers tend to look at the following factors:

1.       How much control does the boss have?  One of the most important factors cited by the case is how much control the boss has over the way that the work is performed.  The less control the boss exercises, the more likely it is that you were merely a contractor.  Did your boss tell you he wanted a deck?  Or did he tell you he wanted the deck built between 7 a.m. and 4 p.m., Monday, with particular features?

2.       Were you reimbursed for expenses?  Independent contractors are less likely to be reimbursed than employees. 

3.       Did you invest in the company?  Independent contractors typically have a significant investment in the facilities that he is performing for someone else (the truck, the tools, etc.) 

4.       Did you work for more than one company?  If you made your skills available on the open market and performed the same work for multiple companies, you are likely an independent contractor.

5.       Was your pay per hour or based on profit/loss?  Employees are paid on an hourly basis and make the same amount of money no matter whether business is booming or tanking.  The salary of an independent contractor, on the other hand, is often contingent upon the salary of the company as a whole.

6.       Were you hired permanently or temporarily?  If you are hired with the expectation that you will work until you are fired or move on, you are likely an employee.  However, if you are only working until the end of the work on a particular job site, you are likely an independent contractors.

Courts consider all these factors and more when making the determination.  If you would like more information on the factors considered by courts, please give us a call.

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