Washington Employment Law: Employee or Independent Contractor?

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I was just reading Josh Waxman's post over at Washington Labor & Employment Wire about the Department of Labor's plans to reduce misclassification of employees as independent contractors. In addition to DOL's plan, a new bill on the subject is being considered by Congress. According to the bill itself, the Employee Misclassification Prevention Act (S. 3254, H.R. 5107) aims to, "require persons [namely, employers] to keep records of non-employees [independent contractors] who perform labor or services for remuneration and to provide a special penalty for persons who misclassify employees as non-employees."

While some employers intentionally misclassify employees as independent contractors for a variety of reasons, including saving money on payroll taxes and employee benefits, many employers unintentionally misclassify employees. It's an easy mistake to make. For starters, state law and federal law are not the same and both must be considered. Both state and federal law use complex multi-factor tests to determine proper classification. While lawyers, judges and legislators have a certain fondness for such tests, other people often have a difficult time applying them to particular situations. Even the folks answering the help line over at Washington State Department of Labor and Industries ("LNI") occasionally get it wrong. Perhaps in recognition of these difficulties, the IRS has a form, SS-8 , which can be submitted to have the IRS formally determine the correct classification. However, the IRS takes months to make that determination, and it is of no use when it comes to state law. Because of these difficulties, it is my sincere hope that increased efforts to reduce misclassification include not only penalties, record keeping, plans and notices, but also more and better resources to help employers properly classify their workers. In the meantime, for those struggling to correctly classify workers, LNI has a webinar and links to other resources on the issue.

Or, you can always contact a Washington employment attorney.

Last updated: May 20, 2010

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This article and information contained herein are intended for information purposes only; they are not intended as legal advice and should not be used as such. Any use of material contained herein is at your own risk. Your use of and access to this article do not create any attorney-client relationship between you and Rebecca E. Ary. You should consult an attorney in your state or jurisdiction who can provide advice appropriate to your particular situation. Rebecca E. Ary is licensed to practice only in Washington. The Law Office of Rebecca E. Ary may be contacted at 1037 NE 65th St. #161, Seattle, WA 98115.

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Rebecca Ary has 5 articles online

For Rebecca E. Ary, employment law is a high-stakes, highly personal area of law that holds the power to turn the fortunes of both individuals and businesses. The sense of betrayal, anger, powerlessness and loss of trust associated with failed employee/employer relationships can overwhelm even the most level-headed and seasoned professionals. Which is why hiring a skilled professional like Ms. Ary is so critically important. With a deep desire to help her clients and in-depth knowledge of employment law, Ms. Ary practices her craft with exceptional skill and attention to detail. She takes a balanced, analytical, strategic approach that allows the strength and fairness of the law to prevail. Ms. Ary’s talent for listening and her ability to develop a persuasive and creative strategy positions her clients for more positive outcomes. A skilled negotiator and litigator, Ms. Ary is well-respected by her peers and known throughout the legal community as a powerful advocate for her clients.

Ms. Ary received her Juris Doctorate degree from University of Washington School of Law and her Bachelor of Arts in Philosophy from University of California, San Diego. She was recently included in Super Lawyers 2010 – Rising Stars Edition, a national professional lawyer’s listing that recognizes a small percentage of all Washington state lawyers and identifies outstanding individuals who have attained a high degree of peer recognition and professional achievement in their field. Ms. Ary is a member of the Washington State Bar Association, the King County Bar Association, the Washington Employment Lawyers Association and American Mensa.

In her free time, Rebecca has served as a volunteer for NAMI (The National Alliance on Mental Illness), and Literacy Source, an organization dedicated to helping adults learn to read. She is an avid reader who also enjoys hiking, and spending quality time with Elaine, her cat.

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This article was published on 2010/12/22