Employees Misclassified as Independent Contractors

Many employers try to save money by improperly labeling some of the employees they hire as consultants or independent contractors. Being improperly designated an independent contractor can have serious negative consequences for you. Typically, only employees are eligible to receive employee benefits such as health insurance, paid vacation, holiday or sick leave, 401(k) plans, pension plans, state disability insurance, unemployment insurance and many other benefits.

Additionally, independent contractors often have much less protection from workplace discrimination, harassment, or retaliation that they face at work. As a result, it can be extremely important to know whether you really are an employee even though your employer is calling you an independent contractor or consultant.

Misclassification of employees has become such a serious concern that the United States government is vigorously enforcing laws addressing the issue. But the federal government cannot prevent all employee misclassifications. Rather, much of this work has to be done by New Jersey employment lawyers.

Being an independent contractor is not always a bad thing. For example, the New Jersey Sales Representatives Rights Act ("NJSRAA") protects independent contractors who are paid commissions.  Better yet, under the NJSRRA you might be able to recover four times your damages.

For additional information, please read the following article: Independent Sales Representatives May Be Entitled to Quadruple Damages.

It often can be confusing to determine if you are an employee or an independent contractor, especially since companies misclassify their workers so frequently. In fact, different laws have different definitions of who is an employee.  Moreover, even if you signed a contract stating that you are a consultant, you still might be an employee for some or all purposes.

Feel free to contact us online to schedule a meeting with one of our New Jersey employment law attorneys who represent independent contractors.

The three most important factors to determine whether you are an employee rather than an independent contractor under New Jersey’s anti-discrimination law, the New Jersey Law Against Discrimination ("LAD"), and its whistleblower law, the Conscientious Employee Protection Act ("CEPA"), are:

• How much control the company has over your work;
• How economically dependent you are on your job; and
• The extent to which your job is integrated into the company's business.

Other relevant factors include your level of skill; whether you or the company provide your tools, equipment and workplace; how long you have worked for the company; and whether the company pays you like an employee or like an independent contractor.

Other New Jersey employment law statutes use different tests to determine whether you are an employee or an independent contractor. To learn more about some of the tests used to determine whether a worker is an employee or an independent contractor, you can read the following articles from our employment law Blog:

• New Jersey Supreme Court Broadens Definition of "Employee" Under Wage and Hour Law
• Working Through Independent Business Not Enough to Make Employees into Independent Contractors
  
• Court Must Reevaluate Whether Workers Are Independent Contractors or Employees
• Jury Must Decide Whether Workers Are Employees or Independent Contractors Under New Jersey Law Against Discrimination

Rabner Baumgart Ben-Asher & Nirenberg, P.C. is dedicated to advancing employee rights in New Jersey and New York.

To help determine if your company has misclassified you as an independent contractor even though you really are an employee, or to learn more about any of your other legal rights in the workplace, you can contact us online or call us at (201) 777-2250. We have the experience, knowledge and dedication to enforce your legal rights at work.

For more information about legal protection for independent contractors, we invite you to please read one of the following articles written by our New Jersey employment law attorneys:

• Independent Contractors Protected by Conscientious Employee Protection Act
• Sexual Harassment of Independent Contractor Can Violate New Jersey Law Against Discrimination
• FLSA and FMLA Protect Employees Misclassified as Independent Contractors
  
• New Law in New York City Protects Independent Contractors