Pit & Quarry, September 2016
LABoR Battling for independent contractor status When it comes to classifying workers as employees or independent contractors be sure to get it right lthough independent contractors are a proven way for aggregate producers to achieve workforce flexibility and save money they a are also a popular strategy that provide operations a great deal of flexibility and in many cases lower tax bills Combine those lower tax bills with the difficulty in determining who is and who isnt an independent contractor and you have an explanation for the Internal Revenue Services IRS ongoing crackdown on worker misclassification The Government Accountability Office estimates that worker misclassification costs the federal government 27 billion per year while both the IRS and the U S Department of Labor DOL believe that up to 30 percent of employers are misclassifying workers Recent court cases such as the suits brought against Uber and Lyft by their drivers in California have resulted in both the IRS and DOL announcing even more crackdowns on worker misclassification In fact cracking down on employee misclassification is a proven revenue generator for the IRS but should that crackdown strike fear into the hearts of those in the aggregate mining industry by Mark E BattErsBy An IndePendenT conTRAcToR What all independent contractors have in common is theyre not considered employees of those who utilize their services What makes them independent contractors is that those who use their services say they are usually so they dont have to pick up the costs of having full time employees As an independent contractor a worker operates outside the protection of the labor laws Under common law rules anyone who performs services for another is an employee if the one paying for the services can control what will be done and how it will be done Therefore an employer employee relationship exists when the person for whom services are performed has the right to control and direct the individual who performs the services not only as to result but also as to details and means All independent contractors are considered to be self employed and therefore their earnings are subject to Self Employment Tax While independent contracting is on the rise true independent contractors differ from the quasi freelancers created by companies such as Uber and others championing the so called gig economy 94 PIT QUARRY September 2016 pitandquarry com ISTOCK COM OlIvIer le MOal a producer that misclassifies a worker as a contractor may be required to pay back taxes provide employee benefits and more
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