Many companies prefer hiring independent contractors instead of full-time employees to save on benefits, payroll taxes and unemployment insurance. This arrangement can provide businesses with specialized skills without long-term commitment.
However, worker misclassification has become increasingly common in Ohio and nationwide. Companies often incorrectly label workers as independent contractors when they should legally be considered employees.
This mistake, whether intentional or otherwise, allows businesses to avoid legal obligations while denying workers their rightful protections and benefits under the law.
Characteristics of employees vs. contractors
The Fair Labor Standards Act (FLSA) provides important employee protections, including minimum wage requirements, overtime pay and other benefits. However, these protections don’t extend to independent contractors, making proper classification crucial.
Clear distinctions exist between these designations:
Signs you might be an employee:
- Your employer controls when, where and how you perform your work
- You receive ongoing training from the company
- The company provides your tools and equipment
- You work exclusively or primarily for one business
- Your relationship with the company appears permanent or indefinite
- Your work is a key part of the company’s regular business
Signs you might be an independent contractor:
- You control your own schedule and how work gets completed
- You use your own equipment and tools
- You have the opportunity for profit or loss based on your work
- You offer your services to multiple clients or businesses
- Your relationship with the company is project-based or temporary
- You operate as your own business entity
Misclassified workers often miss out on crucial benefits like overtime pay, minimum wage protections, unemployment insurance and workers’ compensation coverage. This can result in significant financial harm, especially during periods of injury or unemployment.
Steps for misclassified workers
You have several options if an employer misclassifies you as an independent contractor in Ohio. First, gather documentation of your working relationship, including communications about work expectations, payment arrangements and any control the company exercises. Keep records of hours and payments.
Consider discussing the situation directly with your employer, as misclassification sometimes results from misunderstanding rather than a company intentionally avoiding its obligations. If that doesn’t resolve the issue, you can file a complaint with the Ohio Department of Commerce or the U.S. Department of Labor’s Wage and Hour Division.
An employment law attorney can review your situation and help determine your proper classification. A skilled lawyer can explain your rights under both Ohio and federal law, calculate any unpaid wages or benefits you may be entitled to and represent you throughout the complaint process.
Remember that the law prohibits employers from retaliating against workers who assert their rights regarding proper classification. Asserting your legal status as an employee ensures you receive all the benefits and protections you deserve under the law.
