How should I classify my workers – as employees or independent contractors?
In North Carolina, under the Fair Labor Standards Act, workers may not be classified as independent contractors when they are really employees. To determine whether a worker is an employee or an independent contractor, courts typically focus on a number of factors. Those factors include:
- Whether the work is an integral part of the employer’s business.
- Use of managerial skills.
- Ownership of tools and equipment.
- Permanency of employment.
- The degree of control exercised by the employer.
North Carolina recently passed the North Carolina Employee Fair Classification Act, which will come into effect on December 31, 2017. This act will add an Employee Classification Section to the NC Industrial Commission whose sole purpose will be to determine whether an employee has been misclassified as an independent contractor.
This act will give workers an easy avenue to file a complaint if they feel they have been misclassified. Make sure your business is in compliance.
~Karen McKeithen Schaede
This article is for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. The information contained in this article does not create an attorney-client relationship between Connors Morgan PLLC and the reader.