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Employee or independent contractor? Actual working conditions dictate classification

by on
in Hiring,Human Resources

Employers sometimes think that if they hire “independent contractors,” they won’t have to worry about things like benefits, overtime and the like.

But some make the mistake of ­assuming that merely because those workers sign contracts stating that they’re not employees, that’s enough. It’s not.

What counts instead are the actual working conditions. The more freedom and true independence the individual has, the more likely the worker is an independent contractor.

Recent case: Gary Zermeno signed an independent contractor agreement with Simplify Technology, which installs cable, Internet and phone service for Comcast customers. Zermeno wasn’t paid for overtime hours, although he claimed he often worked more than 40 hours per week and sometimes 12 hours a day, six days a week.

When Zermeno sued, Simplify Technology said he was a true independent contractor who was free to work for others, supplied his own tools, was responsible for his own training and set his own schedule.

But Zermeno told a different story. He claimed he had to report to the employer early in the morning and had to check back often for assignments. He had only basic tools and, practically speaking, couldn’t work for anyone else since he had to complete all Simplify assignments within specific time frames.

The court said what counts is the actual job, not what the contract says. It said Zermeno’s lawsuit could go forward. (Zermeno v. Cantu, Garza d/b/a Simplify Technology, No. 10-01792, SD TX, 2011)

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