Industry Best Practices for Contractors Are Always Right…
Welcome back to the blog series on the 13 Myths of Independent Contractors. We created this series to help you navigate some of the potential legal minefields caused by the complex legal environment surrounding independent contractors. The content from this series comes from the whitepaper: Independent Contractor Myths versus Reality.
Myth: It is safe to follow established industry practice when classifying certain workers as independent contractors.
Following “common industry practice” is not a defense to misclassify a worker under the FLSA, or any other statute.
Regardless of the industry practice, if the contractor’s work falls within a law’s definition of employment, they cannot be classified as an independent contractor and denied their rights as an employee under that law.
Under the FLSA, FMLA, MSPA, and many states’ regulations, what matters is whether the reality of the situation indicates that the worker is economically dependent on the employer (an employee) or in business for themselves (an independent contractor). For federal tax purposes, what matters is whether the employer has the right to control how the worker does their taxes (however, there is a special relief provision for federal employment tax purposes under which industry practices may be relevant).
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