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Employee vs. Independent Contractor Under Workers’ Comp Laws

An independent contractor is different from a full-time, part-time or seasonal employee. While contractors tend to have more independence when it comes to the work they do, being an independent contractor also comes with a few risks. One of them is that you are not guaranteed workers’ compensation paid by the employer. At Cruz & Associates, we can help you get the settlement you need if you’re a contractor who’s been injured by the negligence of an employer.

What’s the Difference Between an Employee and Independent Contractor?

An independent contractor is typically someone contracted to perform services without being an employee. An employee is a person who is under service of an employer in return for compensation. This may seem confusing, but there are a few notable differences between the two when it comes to legal work requirements.

Tax Forms

The biggest differentiator between an employee and contractor is that the employee has a W-2 tax designation, while a contractor has a 1099 tax designation. This means that the employer is not responsible for payroll taxes on the independent contractor; the contractor pays those taxes themselves.

Hiring and Payment

Employees are typically paid by hourly or salaried wages, while independent contractors are most likely paid by the job. Independent contractors may also have subcontractors who work under them and are, by default, hired by the employer to help the contractor complete the task.

Project Control

If you’re a full-time employee, you are expected to complete tasks in a certain way as directed by your employer. Independent contractors are typically expected and trusted to carry out projects on their own time, with their own subcontractors, and with minimal direction from the employer.

Nature of Work and Employer Relationship

Independent contractors usually have one highly specialized skill and are hired to perform that skill on one specific part of a large project. For this reason, independent contractors are able to work for more than one employer at a time.

Workers’ Compensation Policy

Employers are not required to provide workers’ compensation for independent contractors. Typically, independent contractors are responsible for securing their own workers’ compensation policy. If an independent contractor has subcontractors under them, they are responsible for the subcontractor’s workers’ compensation as well.

Injured as an Independent Contractor? Here’s What to Do Next

If you’re an independent contractor who was injured by the negligence of an employer on the job, you may feel powerless. First, clarify that you were rightfully classified as an independent contractor. Many employers wrongfully label their employees as contractors under the table to avoid carrying workers’ compensation insurance. If there’s been a misclassification, this is higher grounds for a lawsuit.

However, even if you were rightfully classified as an independent contractor, there is still hope for your workers’ compensation. Employers are expected to provide safe working environments and clear instructions. Failure to do so is grounds for a lawsuit.

Contact Cruz & Associates in Phoenix Today

If you were injured by employer negligence, the experienced team at Cruz & Associates is able to help you get the settlement you deserve. While there are detailed ins and outs of working as an independent contractor, you can rest assured that our attorneys are skilled in these nuances. Don’t suffer alone—talk to a trustworthy legal representative about your case. You can give our Phoenix office a call at (602) 777-6666 or fill out our online contact form to get started.

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