1. Part-time Employees v. Independent Contractors
Local Government Seminar January 29, 2015
Part-time Employees v. Independent Contractors
Presented by:
Denis Potvin

2. Part-time Employee v. Independent Contractors
It is important to properly distinguish between the two because employees and independent contractors are treated differently for the purposes of liability, taxes, and employment issues.

3. Hybrid Economic Realities/Common Law Control Test
The Test
Hybrid Economic Realities/Common Law Control Test
2 Components:
Control Component
Economic-Realities Component

4. Practical Differences: Liability
Part-time Employee
Employer’s liability to employee
Employer’s liability to third party
Vicarious Liability
Negligent Hiring/Supervision
Independent Contractor
Employer’s liability to employee
Employer’s liability to third party

5. Practical Differences: Taxation
Part-time Employee
Form W-2, Wage and Tax Statement
Federal Income Tax
Social Security and Medicare Taxes
Independent Contractor
Form W-9
Form 1099-MISC

6. Practical Differences: Employment Issues
Part-time Employee
Compensation: Texas Minimum Wage Act
Unemployment Compensation
Discrimination
Civil Rights Act of 1964
Americans with Disabilities Act of 1990
Independent Contractor
Compensation paid per job
Not eligible for unemployment compensation
Discrimination protection limited

7. Employee v. Independent Contractor Characteristics

8. Ramifications of Mischaracterizing
Liability
Rule of thumb: Contract with independent contractors to make the relationship clear to a potential third party.
Taxation
Rule of Thumb: When in doubt characterize the worker as an employee.
Employment
Discrimination Rule of Thumb: Do not engage in discriminatory practices.
Unemployment Compensation Rule of Thumb: When in doubt characterize the worker as an employee.