WHAT’S THE DIFFERENCE BETWEEN AN INDEPENDENT CONTRACTOR AND AN EMPLOYEE?

Employees and independent contractors are two different types of individuals who work for an employer. They are treated differently under state and federal law, and there are many protections and benefits that are afforded to employees that may not be offered to independent contractors. Independent contractors are also treated differently for taxation purposes.

The main test for determining whether an individual is an independent contractor or an employee is the amount of control that the employer has over the individual. If the employer can only control the result of the work, such as the ultimate article that is created, the individual is probably an independent contractor. Conversely, employers are more likely to have behavioral control and financial control over individuals who are employees. This means that they can control the method by which the employee works, such as setting office hours or requiring a worker to use certain equipment. They also control the financial nature of the work, such as how a worker is reimbursed or whether they are allowed to seek outside competing business opportunities.


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