7 Signs that You've Been Misclassified as a Contractor | Blog | Aiman-Smith & Marcy
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7 Signs that You’ve Been Misclassified as a Contractor

Independent contractors are not entitled to minimum wage, benefits, or overtime pay. This allows actual contractors to work freely on long or short projects, setting a rate to charge based on the temporary value of their work. Real contracts find freedom in non-employee status. However, when employers start misclassifying employees as contractors, it’s a way to control and cheat them out of their employee rights.

Have you been misclassified?

Across the US and especially here in California, employees are required to make minimum wage or higher, be paid time-and-a-half for 40+ hour weeks, and must be given basic employee benefits. This is to ensure that full-time employment creates a survivable lifestyle. Denying these rights is an employer’s way of saying they don’t care if their team is living a survivable life. They would rather work people odd hours, pay nothing for overtime, and skip out on benefits costs.

It’s easy to see why some employers commonly cheat their staff by classifying them as ‘contractors’ instead of rightful employees. Fortunately, the definition of employee is determined by ‘economic reality‘. If you have been classified as a contractor but suspect this is incorrect, check these 7 signs that you should really be an employee with overtime and benefits.

Paid by the Hour, Not the Job

Contractors are typically paid by the job or sometimes by the month for services rendered. Employees are paid an hourly wage. Contractors can work fast while getting full pay for each project. Employees don’t get paid for hours they don’t work – no matter how good or fast that work might be. Contractors can fall back on other clients if an employer won’t meet their asking price. Employees can either stay or be fired.

If you are paid by the hour, you may be an employee.

Use Employer’s Tools and Supplies

Contractors are prepared to provide the full extent of their service solo. They often show up with their own equipment or provide service from their own private workstation without need for supplies from a client. Employees must use the tools and supplies provided. Employees must wear what their manager says to wear and use what and how their manager says to use it. Employees may be required to take assigned tools or check out team tools. 

If you are using company tools and supplies to do your daily work, you are more likely to be an employee instead of a contractor.

Limited to No Control Over the Work You Take

When your manager assigns tasks, can you veto? Can you say “Sorry, I only work on X, so that’s what I’ll be doing” or must you take the tasks as given?

Contractors choose their own clients and are hired per-project to provide their expertise. They may only work on vehicles, or only take jobs wiring phone lines. Even a service contractor who works with the business model determines what they do and their contract often defines that work. But an employee takes whatever tasks are given by the employer with the ever-hovering reality that not doing so could result in firing.

If you cannot choose or decline your work tasks, you are very likely an employee.

The Role is Permanent

Most contracts are not indefinite. A contractor signs on for completing a specific project or sometimes working with the company for a set amount of time. However, if your employment goes on until either party chooses to terminate it, you are not a contractor.

The Role is Essential to Business Function

Contractors provide additional services beyond the core functions of employees. So is your role part of the ‘core’ of your company’s business model? Do you do something that, if no one did it, the company would come to a full stop? If so, this is likely a sign that you are really an employee. Retail workers, for example, are employees because a store could not function without them.

Schedule is Determined by the Employer

Contractors may have hectic and demanding schedules, but only because they choose to. Contractors can take their own time to deliver results, as long as those results are available at the set deadline. Contractors usually make their own workflow to get the work done. Employees, however, can only work when the employer allows. If your schedule is charted weekly or changed on a whim, then you are far more likely to be an employee.

No Specialization is Necessary for the Work

Finally, ask yourself if your task requires special skills. Getting job training is not the same as bringing something special to the table. For example, they may provide server maintenance or product testing. If your skillset is considered in the pool of generalized skills for your role, then you are more likely to be an employee, while highly specialized individuals also have a higher likelihood of being hired as contractors.

Get Properly Classified with Aiman-Smith & Marcy

Being misclassified is a terrible violation of your rights as an employee. If your employer tells you what to do, how to do it, and sets your work schedule then you are most likely an employee – entitled to minimum wage, overtime, and benefits. If your employer is misclassifying you and others, you have options. Contact us here at Aiman-Smith & Marcy. We are dedicated to defending employee rights and holding employers responsible for intentional or even unintentional employment fraud.