Am I Being Misclassified as an Independent Contractor?

A common legal violation among employers in Ohio is misclassifying employees as independent contractors. This tactic is used to avoid paying for benefits that are lawfully owed to employees, such as workers’ compensation and health insurance. If you believe you are being misclassified as an independent contractor in Ohio, you may need to hire a Cleveland employee misclassification attorney to help you seek justice.

Why Do Employers Misclassify Workers?

Under Ohio law, independent contractors are not entitled to certain protections that employees are under the FLSA, including minimum wage and overtime pay standards. This makes it enticing for employers to misclassify employees as independent contractors to protect their profits. Worker misclassification is especially common in blue-collar occupations, such as the construction industry.

Employees vs. Independent Contractors in Ohio

The federal law that explains the distinction between an employee and an independent contractor is the Fair Labor Standards Act (FLSA). The FLSA has specific rules in place that employers must follow when classifying their workers; an employer cannot simply choose a designation. In general, workers have more control over employees compared to independent contractors.

An employer has the right to control what work an employee does and when this work is done. Independent contractors decide these matters for themselves. An employee also typically has access to tools and resources owned by the employer, while an independent contractor provides his or her own workspace and equipment.

The permanency of the relationship between the worker and employer can also affect a worker’s classification. A more permanent or long-term relationship with regular paychecks and the potential for benefits or promotions describes an employee, while independent contractors are generally hired and paid on a per-project basis.

What Is the Economic Reality Test?

If an employee misclassification case goes to court in Ohio, the courts will apply the FLSA’s “economic reality” test to determine the correct classification. The FLSA test is more likely to determine that a worker is an employee than other tests used by the federal government.

The economic reality test considers six main factors:

1. The worker’s potential for profit or loss based on his or her work performance
2. Investments made by the worker and employer
3. The permanence of the professional relationship
4. The nature and degree of control the employer has over the worker
5. Whether the work performed by the worker is critical to the employer’s business
6. The level of skill and initiative displayed by the worker

Additional factors that are relevant to the case may also be considered, such as whether the worker is economically dependent on the employer.

What to Do if You Are Being Misclassified as an Independent Contractor

If you are being misclassified as an independent contractor by an employer in Ohio, you may be entitled to financial compensation for the benefits that you have missed as a non-employee. Your employer could be required to pay you back for unpaid wages, including unpaid overtime and other lost employment benefits. Your employer could also face penalties under the FLSA.

In this situation, the best way to protect yourself is by hiring a Cleveland wage and hour attorney. A lawyer can review your work situation to help you determine whether you are being misclassified. If so, your lawyer can help you gather evidence to prove this, such as employment documentation. Then, your lawyer can assist you in negotiating with your employer or filing a formal claim in Ohio.

For a free initial consultation about a misclassification case, contact Scott & Winters Law Firm, LLC today.