When to use a subcontractor or independent contractor?
The general rule of thumb is if they don’t meet the requirements of an independent contractor or subcontractor, they land right here. Now, when it comes to your workers’ compensation insurance, it’s important to keep a few key things in mind.
Can a part time employee be classified as an independent contractor?
Employers and employees alike often face confusion regarding whether part-time or temporary workers should be classified as employees or independent contractors. One reader wrote to us with the following scenario: I sit in a pod with 3 other full time employees doing the exact same work I’m doing.
Can a day laborer be a subcontractor?
So, that would cover anyone who you’ve paid during the year via IRS 1099 forms, day laborers paid in cash and uninsured subcontractors. The general rule of thumb is if they don’t meet the requirements of an independent contractor or subcontractor, they land right here.
What’s the difference between an employee and a subcontractor?
When it comes to hiring for specific tasks or roles, the differences between employees, subcontractors, independent contractors and contractor laborers can get confusing. Then throw in what you need to know about how they impact your payroll and workers’ compensation insurance policy, and you might end up feeling pretty lost.
How is a subcontractor paid as an independent contractor?
These contractors set their own rates and schedules for labor and payment. Typically, they are paid through the accounts payable department at a company. This independent contractor then employs subcontractors who are paid and controlled by the contractor but who still performs labor for the employer.
What kind of person is an independent contractor?
Information For… People such as doctors, dentists, veterinarians, lawyers, accountants, contractors, subcontractors, public stenographers, or auctioneers who are in an independent trade, business, or profession in which they offer their services to the general public are generally independent contractors.
Can a subcontractor be listed as an employee?
Being that a subcontractor cannot be listed as an employee as well, the company must ensure they are listed as a subcontractor and not offer benefits. Benefits that should not be provided may range from healthcare, 401K, paid time off, sick time and so forth.
What to avoid when working with independent contractors?
Don’t prohibit the IC from using subcontractors. Don’t let the IC work at your offices unless the nature of the services absolutely requires it. Don’t give the IC employee handbooks or company policy manuals. Don’t establish the IC’s working hours. Avoid giving ICs so much work or such short deadlines that they have to work full time for you.