Sacramento Employment Law Attorney

Helping Independent Contractors & Contingent Workers

California’s modern-day workforce is composed of a mix of traditional employees, independent contractors, and a new group of workers known as contingent workers. The existence of these three distinct groups of workers gives businesses a great deal of flexibility in deciding how to meet their staffing needs. It is important that business owners, independent contractors, and contingent workers understand the benefits of these alternatives to traditional employees and the limited rights available to them.

What Is an Independent Contractor & What Benefits Does This Position Provide?

There is no standard definition for what constitutes an “independent contractor.” Instead, an independent contractor is characterized by his or her independence from the employer. Determining whether a person is an independent contractor is always a fact-intensive inquiry that looks into how much control the employer is able to exercise over the independent contractor and how the independent contractor does his or her work.

Independent contractors can be beneficial to employers looking to cut costs because:

• An independent contractor bears the burden of any project that goes over budget;
• The independent contractor is not entitled to any overtime pay from the employer;
• The independent contractor is not eligible for worker’s compensation benefits through the employer;
• The independent contractor is not eligible for traditional employee benefits.

Independent contractors also have limited rights to sue their employer for the employer’s wrongful conduct. For example, the Fair Employment and Housing Act has been previously said to not apply to independent contractors. (Nevertheless, independent contractors may be able to bring a suit against an employer that discriminates against the independent contractor during hiring or where the employer harasses the independent contractor).

What Is a Contingent Worker & What Benefits Does This Position Provide?

Contingent workers comprise a new classification of worker. A common example of a contingent worker is the employee of a hiring or staffing agency that provides staffing services to area businesses that need to supplement their workforce. The contingent worker is usually an employee of the staffing agency but may also be considered an employee of the business that retains his or her services.

Contingent workers are generally compensated less than traditional employees performing the same job duties. Contingent workers also tend to have lower health insurance and other similar premiums. This means that the employer who uses contingent workers may realize more monetary savings than they would if they used traditional employees.

What If I Am Not an Independent Contractor or Contingent Worker?

Employees, independent contractors, and contingent workers should take steps to ensure that their employers properly classify them. You may lose significant benefits and protections if you are an employee but classified as an independent contractor. Likewise, any protections you may have as a contingent worker may disappear if your employer treats you as an independent contractor. One way to tell how your employer classifies you (aside from asking) is to examine your paycheck; if your paystub does not show deduction for standard employment taxes, pensions, and/or healthcare premiums, chances are your employer is not treating you as a traditional employee.

Employers who deliberately misclassify workers can face serious penalties and costs.

Understanding your rights as an independent contractor or contingent worker is important. Contact my office today at 916-443-3553 and learn how my knowledge and experience can assist you during an initial consultation.