My Contract Says I Am An Independent Contractor: Am I Entitled to Overtime and Benefits?

Workers are normally defined as either employees or independent contractors. Most employees and/or employers wrongly believe that if the worker has a contract that defines him or her as an independent contractor, then they must be an independent contractor. That is a myth and not the real legal standard. Many workers are wrongly classified as independent contractors, when they are really deserving of the protections and benefits of employees.

Most employment laws define whether someone is an employee or an independent contractor based on how much control is exercised by the employer over the worker’s day to day activities (with more control suggesting the person is an employee). Other factors that suggest someone is an employee, not an independent contractor, include:
•      You work primarily or exclusively for one employer/business;
•      Your work is a regular part of the business engaged in by the employer;
•      Your employer provides your tools/equipment;
•      Your employer provides you with insurance;
•      Your employer provides time off;
•      Your employer provides you with an office; and
•      You are paid by the hour or a salary.

Employers have an economic incentive to misclassify employees as independent contractors. Your employer is thereby avoiding providing you with benefits that are usually provided to employees (e.g. health insurance, 401(k) matching) as well as avoiding providing their legally required share of your employment taxes (e.g. 6.2 % of wages for Social Security, 1.45% for Medicare, and varying state unemployment taxes). Employers also usually do not pay independent contractors overtime.