For many workers, being told they’re an independent contractor instead of an employee creates more confusion than clarity. At first, it might seem harmless or even appealing since it sounds like you have more freedom. However, you might be missing out on a lot of benefits and protections.
You might not notice the problem right away. However, being misclassified can prove costly in the long run. Here’s why.
No access to workplace protections
Employees have certain legal safeguards that independent contractors don’t, such as minimum wages, overtime pay and anti-discrimination protections. Further, only employees are entitled to workers’ compensation benefits after a workplace accident. These are just some of the rights you miss out on as a misclassified worker.
Paying more in taxes
When you’re misclassified as an independent contractor, you shoulder the entire burden of taxes. Instead of your employer covering a portion of Social Security and Medicare, that responsibility wholly falls on you.
No safety net if you lose your job
Unemployment insurance can help you pay your bills if you suddenly lose your job, but only if you were an employee. Independent contractors are not covered. You will be on your own if you were wrongly classified.
Taking back control
If you’ve ever felt something was off about your work arrangement, you’re not alone. Many people do not understand what the law says about proper classification or how rampant misclassification is. That works in favor of employers who misclassify their workers.
Remember, you can challenge your status and seek to recover what you have earned and not been paid. Seeking experienced legal support can help you understand your rights and take informed action as a misclassified worker.
