The Difference Between Salaried and Independent Workers
In most cases, a person working for a company is either a salaried employee or some form of independent contractor. The difference between the two is often more significant than most people realize. Both employees and contractors can earn a steady wage working for the same company. However, the rights associated with employment are much higher compared with freelance work.
While employees have the right to certain benefits, such as overtime, unemployment insurance, or healthcare, independent contractors do not. In addition, non-employees are generally not eligible to pursue a workers’ compensation claim after a workplace accident.
Certain employees—known as exempt employees—take a salary and work for the company, but they do not enjoy any of the benefits, such as 401(k) matching or health insurance coverage. This option is only available to high earners who are typically at the executive level.
Understanding the difference between these options can be challenging. Thankfully, our attorney in Bakersfield can answer questions on misclassification between salaried employees and independent contractors.
Signs of Misclassification
There are a few different signs of misclassifying employees and contractors in Bakersfield that our attorney could explain. This can be helpful evidence if you are considering legal action. At the core, these signs relate to situations that seem unfair or unreasonable based on the amount of work you do and the control the company has over how it is completed.
One of the most prominent signs is when you are not considered an employee but are controlled like one. This goes beyond receiving specific tasks and includes specific management on how you perform your work.
Another common sign is when you are a contracted worker who does the same work as anyone else, but you do not receive the same compensation, benefits, or vacation time as your coworkers. When this occurs, there are steps available to hold your employer accountable.
What Is the ABC Test?
The state uses a method known as the ABC test to identify the status of a worker. In general, a person is treated as a salaried employee unless they meet all three elements in this test, which are as follows: the worker is free from direct control of the company, the worker performs work outside the typical course of the employer’s business, and the worker regularly engages in independent work.
In other words, the state is looking for signs that a person is operating their own business and not just an employee in everything but the name. Our dedicated attorney could explain more about the elements of the test and discuss a claim for incorrectly categorizing employees and contractors in Bakersfield.
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