Laws around worker classification are getting extra attention right now. Some people are even expressing concern that proposed changes threaten free press. We thought it was high time to address some of the myths that get businesses in trouble. Read to the end for the super good news!
Worker Classification Myth #1: After a certain amount of time working for you, an independent contractor must be reclassified as an employee.
It’s true that rules can be complicated and vary from state to state. Still, this perception overly complicates the issue. We think this myth likely comes from one-time best practices wrongly interpreted as hard and fast rules. Wherever the myth comes from, we’ve seen clients build all sorts of policies to get around the supposed law. We’ve seen them hire workers for six months, drop them for a period of time, and then rehire them, for example. Some companies even refuse to rehire independent contractors after working with them for a certain amount of time because they’re afraid they’ll have to provide all of the benefits associated with hiring an employee. Not only are these policies time consuming, they can hurt businesses that rely on trustworthy freelancers.
There is a fine line between an employee and an independent contractor and laws surrounding worker classification are confusing. Still, we’ve seen companies get unnecessarily complicated—going to great lengths to comply with nonexistent rules. We think it’s time for everyone to bust the myth and bust free from self-imposed restrictions.
Here’s the liberating truth: If you find a good contractor and want to use them over and over, you can. There are rules, which vary by location, but there are also legal ways to keep your best people working for you.
Worker Classification Myth #2: I don’t need to waste my brain space to understand the rules.
Maybe this one persists not because of misinformation but simply because we want to believe it. Sort of like the 5-second rule? Both are bogus, by the way.
When laws change frequently, big money is on the line, and rules are complicated/vary from state to state, it’s tempting to ignore the issue until it shows up on your doorstep dressed in red with a pitchfork and horns. So much braining.
Sorry to burst your bubble, but even if you’re not in California, this thing affects you. That’s not only because other states, including New York and Michigan, are thinking about making changes too, but also because every state has its own rules. These rules can affect everything from the price you pay on a ride-sharing app to where and how you get your haircut.
The consequences for businesses who don’t comply can be damaging to your reputation and pocketbook (fines, fees, and lawsuits, oh my!).
The Liberating Truth: You Don’t Have to Know it All
This truth will save your brain (along with your wallet and your reputation) is that no matter where you are, you cannot afford to ignore worker classification rules. There’s another happy truth, though: If you don’t want to/can’t get into the nitty-gritty details yourself, you can rely on a qualified partner (👋) to do it for you. Reach out to our team of experts on all things freelance. Get away from the burden of onboarding, payrolling and classifying your workers and focus on what you love.