All workers in Washington are entitled to a work allowance unless they meet strict definitions of waivers. Make sure your business understands your company`s requirements for worker coverage, including independent contractors. If your company discovers that there is labour that should have been declared for workers` compensation, your company will be held responsible for unpaid premiums with penalties and interest. Think of lawyers as an example of this difference. If you are a small company, you will probably work with a lawyer on discrete projects, for example. B when creating an LLC or when applying to register a trademark; But you are just one of many of this lawyer`s many other clients. In this context, the lawyer works as an independent contractor. But if you are a very large company and you have an in-house consultant who provides ongoing legal services only to your business, the lawyer works as an employee. The Ministry of Labour and Industry has an independent contractor test that helps companies determine whether they should cover workers` compensation. Their independent contractor must pass audits of the Ministry of Labour and Industry in order to obtain compensation savings.
Based on how the company responds to the questions below, it can help determine whether workers` compensation coverage should be granted. For example, if the business owner answers „yes“ to most questions, it probably means that coverage is not necessary. Training: The agreement should stipulate that no training is provided to the independent contractor. The more instructions and training are provided to the workforce, the more likely it is that the relationship indicates that the person is an employee. Duration: The agreement should set a duration for the agreement. A commitment limited to a short term or an end as soon as the project is completed usually involves contracting status. This complexity is compounded by the fact that different public and federal authorities use different tests to determine contractual status, which means that a worker could be classified as an independent contractor under one test and an employee under another. A handful of the various tests are listed below: Non-Compete: Unlike an employee, independent contractors generally work for many companies. Therefore, the agreement should provide, as far as possible, that the contractor can work freely for other companies and does not contain a non-competition clause. While it may be possible to include a non-compete clause at a restricted level, such a clause is generally avoided because it prevents the contractor from working for other companies, which could involve worker status. Confidentiality, non-formal notice and confidentiality agreements should also be entered into to protect the company.
What you call your employees doesn`t determine their status as contractors or employees – it`s how you treat them.