Whether you're a small business or a large corporation, there are times that you may require the assistance of Independent Contractors. While you can't always hire everyone as an employee, there are things you should know in order to prevent a lawsuit from a freelance worker that feels they were treated unfairly.
According to the U.S. Labor Department, one of the most important issues that they consider a priority is to identify employers who use the system to get past certain laws by using freelancers or independent contractors. This may be to not have to comply with child labor laws, minimum wage requirements, or pay overtime. The U.S. Labor Department has started a program just for that, called the Misclassification Initiative.
In order to avoid a lawsuit brought on by a freelance worker or independent contractor, make sure to have everything in writing outlining exactly what the terms of your agreement are. For instance:
- Describe the work in detail with both in agreement
- The terms of the agreement
- An agreement of the freelancer and employer relationship
- How much and how often the independent contractor will be paid
- A statement signed where the freelancer acknowledges they are not to receive company benefits as an independent contractor
- Paperwork showing the contractor's licenses and permits if applicable
- Describe how the relationship can be terminated and notate the circumstances under the terms of the contract
- Notate any relevant information in your contract and have both parties in agreement
If you're not sure of your rights as an employer of an independent contractor or are faced with the potential of a lawsuit, it is important that you speak with an attorney who can help you.