The Difference Between Employees and Independent Contractors

Wage and Hour Lawyers Representing Los Angeles Workers

Wage and hour laws apply to employees but not independent contractors. More often than you might think, employers misclassify employees as independent contractors to avoid following wage and hour laws, such as rules related to minimum wage, overtime, providing meal periods and rest breaks, reimbursement for business expenses incurred in doing their jobs, and payroll taxes. If you are wondering what is the difference between employees and independent contractors because you suspect that you may not have been paid fairly, you should consult the Los Angeles wage law attorneys at The Nourmand Law Firm.

The Difference Between Employees and Independent Contractors

Your status as an employee or an independent contractor may make a difference in how much you earn, among many other aspects of your employment. California’s wage and hour laws only protect employees, and only employees are permitted to go to state agencies to enforce certain laws.

Employers are not required to pay their independent contractors according to wage and hour laws, and they do not need to purchase workers’ compensation insurance for them or pay unemployment or Social Security for them. The state agencies that determine independent contractor status in California are the Employment Development Department (EDD) and the Division of Labor Standards Enforcement (DLSE), but other agencies also have regulations about independent contractors.

The different laws and how they are interpreted by courts and agencies mean that someone could be considered an employee under one law and an independent contractor under another law. Generally, a written agreement stating that there is an independent contractor relationship will not be the only factor to consider in determining whether you are considered an independent contractor under wage and hour laws. Similarly, receiving a 1099 rather than a W-2 will not determine your status.

The rebuttable presumption by the DLSE is that anyone rendering services for another party, except an independent contractor, is an employee under Labor Code section 3357. However, a number of factors will be considered in a dispute. The most important factor is whether the employer or principal controls or has the right to control the work and how it is done.

Other factors that may be considered include whether the worker is engaged in an occupation or business that is distinct from the principal’s business, whether the work is part of the employer or principal’s regular business, who supplies the instruments and tools to do the work, the worker’s investment in the materials required by their task, whether the service involves a special skill, the kind of occupation and the level of supervision, the opportunity for profit or loss based on managerial skill, the amount of time during which the services will be performed, how permanent the relationship is between the worker and the principal, how the worker is paid, and, to a lesser degree, the parties’ beliefs.

Generally, there is an employer-employee relationship if the employer or principal has significant control over work operations, the worker’s duties are integral to the operations, and the nature of the work makes careful control unnecessary.

You may be worried about the possibility of suffering from retaliation for objecting to not being paid overtime or demanding the minimum wage, or demand meal and rest breaks. When you are an employee, and your employer discriminates or retaliates against you because you ask questions about some aspect of wage and hour rules, or because you file a claim with the Labor Commissioner, you may be able to file a discrimination or retaliation complaint. However, it may be helpful to consult an experienced attorney about your situation.

Consult a Wage Law Attorney in the Los Angeles Area

If you believe that you are being unfairly paid and are concerned about the difference between employees and independent contractors, our Los Angeles lawyers may be able to help you investigate and assert your rights. The Nourmand Law Firm provides skillful legal representation to workers who have been harmed in Vernon, Montebello, Alhambra, Glendale, Beverly Hills, Van Nuys, Santa Ana, Newport Beach, Palm Springs, San Diego, San Bernardino, Riverside, and other cities in San Bernardino, Riverside, Los Angeles, Orange, and San Diego counties. Call us at 800-700-WAGE (9243) or contact us through our online form for a free appointment with a class action attorney or guidance in an individual claim.