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Expert Tips on Classifying Workers

June 14, 2023

Hear from NFIB’s legal expert on how to correctly classify workers

Expert Tips on Classifying Workers

Classifying independent contractors and employees correctly can be difficult because there isn’t a single classification rule. The Executive Director of the NFIB Small Business Legal Center, Beth Milito, recently hosted a webinar to help make the worker classification process easier for small business owners. Throughout the webinar, she provides hypothetical situations and explains ways to determine classification. “The main thing to consider throughout the process of determining whether to classify a worker as an employee or an independent contractor is control,” Milito explained. Topics covered in this webinar include:

Differences between employees versus independent contractors
Noteworthy trends and concerns for businesses as they navigate classification challenges
Three main tests to determine independent contractors
Strategies for avoiding misclassification lawsuits and penalties

“In United States law, a worker is either an employee or an independent contractor,” said Milito. “Each worker must be given only one classification, there can’t be any ambiguity. You can’t be an employee and also an independent contractor for the same company and in the United States we do not have a third hybrid category.” Different government agencies use different tests, which makes it more challenging for small business owners to keep up with the different regulatory compliance rules. “The challenge of misclassification is not a new phenomenon. Courts have been grappling with this for decades…but it’s gotten more complicated and more challenging and there’s more at stake too.” NFIB’s webinar series is the first Wednesday of every month. The next webinar will be Small Business Toolkit Essentials. NFIB’s Research Center Executive Director Holly Wade will go over how to review your business plan, incorporate essential vendors & software, evaluate pricing, and more to grow your business on Wednesday, July 5. For more information on classifying workers, download NFIB’s free Guide to Independent Contractors. The on-demand version of the webinar is now available.

Topics:

Legal

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