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What is employee misclassification?

On Behalf of | Sep 13, 2022 | Employment Law (Employee)

It is important that workers in Pennsylvania are properly classified as either employees or independent contractors. This is because employees enjoy rights and benefits that independent contractors do not.

A worker is considered an independent contractor when they control the terms of when and how they perform their jobs and otherwise do business. This freedom can be satisfying, and many people make good money as independent contractors.

However, independent contractors do not enjoy the same benefits as employees. Employers do not need to offer independent contractors job benefits offered to employees, such as medical benefits or retirement benefits. In addition, independent contractors are not eligible for unemployment benefits or workers’ compensation benefits like employees are. Also, independent contractors are not covered by certain laws such as the Family Medical Leave Act.

When is a worker an independent contractor?

In Pennsylvania, workers are deemed to be employees by default, with all of the rights employees have. In order to be considered an independent contractor, two elements must be met.

First, the worker must be in control of the means and terms of how they will perform their services, both those contracted for and those in fact. Second, an independent contractor is someone who works in an independently established profession or business. If these elements are met, the worker will be considered an independent contractor, and will not have the same rights employees have.

Take action if you were misclassified

Sometimes a worker is deemed by an employer as an independent contractor when they are actually an employee. This is referred to as employee misclassification. Sometimes it is an honest mistake. If you believe you were misclassified, you have the option of filing a claim with the Pennsylvania Department of Labor & Industry.