A job site is one of the most diverse work environments. You can see workers hauling lumber, people driving forklifts and management in ties double-checking clipboards.
The differences go far beneath the surface. From master plumbers to HVAC specialists, these employees carry various skill sets and certifications in their toolboxes. Some of these workers are permanent, full-time employees, but many are temporary workers and independent contractors. While you want everyone to work together as a team, when it comes down to laws and regulations, the lines need to be clear.
Employees or Independent Contractors?
You hire a skilled laborer to complete a job in a certain timeframe, but have no authority over how he or she will get the work done.
- Independent Contractor: The IRS classifies an employee as a worker who is told explicitly not only what to do, but how to do it. With independent contractors, supervisors have no say over how the job gets done.
You provide an excellent benefits package and pay taxes on your workers’ wages.
- Employee: Companies are not federally required to pay taxes and provide benefits to independent contractors. If your workers get overtime, holiday pay and taxes removed from their paychecks, they need to be classified as employees.
You supply all the materials and tools for the workers, as well as mandate a specific schedule of hours.
- Employee: Most independent contractors come with their own tools and vehicles. While some employees may choose to use their own equipment from time to time, they will most often use the materials provided by their employers.
CCS knows the importance of following industry regulations for employee classification. The candidates we place are employees of CCS, and treated as such. Giving your independent contractors the same status as employees can violate many federal and state regulations. This can mean occasional fines and fees that can unexpectedly pop up around tax time.
5 Consequences for Mislabeling Independent Contractors
- Reimbursement for overtime and minimum wage.
- Pay back taxes, including federal, state and Medicare.
- Deal with worker’s compensation benefits.
- Provide employee benefits, such as healthcare.
- Increased tax liability.
One of the surest ways to tell is to look at the interactions. Employees have more of a boss and worker relationship with management, while independent contractors are more like partners, and tend to be on an even playing field with supervisors.
Our dedication to the construction industry makes CCS Construction Staffing a great partner in the hiring process. We took the time to fill our candidate pool with prescreened trade laborers, who are ready and able to step on to your site within eight hours of notice. Give us a call today and find out how our temporary, permanent, temp-to-hire and independent contractors can round out your job with a variety of skills and trades.