“Independent Contractor or Employee? Some Clarification”

As discussed in an article on page 8, Fall 2009, issue of Texas Business Today, by William T. Simmons, Legal Counsel to Texas Workforce Commission Chairman Tom Paulson, contract labor is a very misunderstood term. Is a worker an independent contractor or is a worker an employee of an organization? In order to be considered an independent contractor, the article lists the following three criteria (some states require only two criteria to be met):

1. The worker is free from control or direction in the performance of the work.
2. The work is none outside the usual course of the company’s business and is done off the premises of the business.
3. The worker is customarily engaged in an independent trade, occupation, profession, or business.

Frequently temporary help personnel are employees of a staffing organization and are not independent contractors. Nevertheless, “An independent contractor is self-employed, bears responsibility for his or her own taxes and expenses, and is not subject to an employer’s direction and control. The distinction depends upon much more what the parties call themselves.”

I suggest that job seekers review the IRS requirements to become an independent contractor before assuming that role. Please comment in this blog if this information is helpful to you.

Thanks! Glyn