North Carolina laws Regarding Independent Contractors
Whether a worker is an independent contractor or an employee can depend on a number of factors as well as which government agency is looking at the worker’s classification. It is important to know how to properly classify employees in order to avoid fines, unanticipated tax payments, or, liability for injury where the employer failed to provide proper insurance coverage.
In general, an independent contractor is a worker who contracts to do work according to his or her own judgment and method, without being subject to the employer except as to the results of the work.
A worker is more likely to be classified as an independent contractor if he or she:
- Is engaged in an independent business, calling, or occupation;
- Is independently using special skill, knowledge, or training in the execution of the work;
- Is doing a specified piece of work at a fixed price or for a lump sum or upon a quantitative basis;
- Is not subject to discharge because he or she adopts one method of doing the work rather than another;
- Is not in the regular employ of the other contracting party;
- Is free to use such assistants as he or she may think proper;
- Has full control over such assistants; and selects his own time.
A work situation doesn’t necessarily have to contain all of the above factors in order for the worker to be classified as an independent contractor. Courts and agencies will look at the particular circumstances of the working relationship. A business owner or employer who is uncertain as to how to classify a worker should seek the advice of an attorney before making important decisions regarding payroll and workers compensation insurance
What does employment at will mean?
Download this article for more information on “employment at will.”