The U.S. Department of Labor has issued a new set of guidelines that clarify when employers can classify workers as independent contractors.
THE LAW: The Fair Labor Standards Act () defines “employee” and interacts with other federal laws requiring employers to pay for .
For employers, having employees means having certain benefits expenses. Some employers designate workers as independent contractors to avoid paying FICA and federal withholding taxes. Independent contractors also aren’t covered by workers’ compensation and generally have to provide their own benefits.
WHAT’S NEW: The so-called sharing economy has spawned a whole new breed of independent contractors. Uber, the alternative to regulated taxis, is just one example of startups that use independent contractors instead of employees. Uber workers sign up to accept assignments to drive passengers, who pay Uber directly. The company takes a share ...(register to read more)