It is very crucial for a business to distinguish between an employee and an independent contractor. Ignorance of adequate laws that differentiate between an employee and an independent contractor can lead to legal consequences. The distinction between the two helps the business to decide shall prove to be beneficial for the business in the long run.Legal research methodology can help the business under such circumstances by providing all the legal information required.
The basic difference between an employee and an independent contractor is that an employee is on the payrolls of the organization whereas an independent contractor is either on the payrolls of a third party vendor or is self-employed.
Hiring a independent contractor proves to be cost-effective as employers are saved the burden of providing employee-related benefits like workers compensation, medical benefits, paid leave etc. to the independent contractors resulting in huge cost cuttings.
An independent contractor usually operates in his or her own name, operates from own premises, is responsible for paying his or her own taxes, works for more than one client, advertises its work on its own, needs no supervision and invoices the client as per the work performed. In comparison, an employee works under the direct supervision of the employer and works for only one employer, gets a fixed amount as salary and is entitled to certain benefits like paid leaves, workers compensation. Medical benefits, etc.
Many businesses now rely on independent contractors for their staffing benefits as it reduces the liability of the employer, saves labor costs and can be hired or fired as per the requirements of the business.However, it is advisable that employers should use Legal Research Methodology to understand the guidelines that differentiate an employee from an independent contractor
However one should not forget that treating an employee as an independent contractor can lead to tough legal consequences. If an individual is considered an independent contractor by a business, however, he meets the legal criteria laid for an employee, then under such circumstances the business shall be liable for the payment of all back wages under the Fair Labor Standards Act along with health insurance, retirement benefits, workers compensation, etc.
Various tests have been implemented for distinguishing between an employee and an independent contractor like the Economic Reality Test and Common Law Agency Test. Courts constantly gaze further than the tag the employers put upon the employment association in order to ascertain its exact nature. Hence it is advisable that the employers should be aware of the facts that distinguish an employee from an independent contractor to save itself from the legal consequences that it might face if an independent contractor gets identified as an employee.
Legal Research Methodology helps in identifying the key factors that differentiate between an employee and an independent contractor. It gives the employer an insight on who can be treated as an independent contractor. As the relationship between an employer and an employee is varied from that of an employer and an independent contractor, the consequences for wrong classification for both employers and employees are extensive. Hence, both employers and employees need to be vigilant of such classifications.
In the present scenario, it is advisable to use the services of offshore based vendors so as to save time and money. The Offshore vendors support a team of law graduates who are proficient in lease abstraction and make use of their skills to meet customers demands to chalk out a perfect abstract thus catering to customer needs. At times, the abstraction team of Complete Legal Outsourcing prepares a tailor made template so as to meet the specific needs of its clients. So just let us know what all you are looking for in a abstract, our team ensures that the same is delivered as we firmly believe that a satisfied client is a permanent client.
Outsourcing also helps in savings costs as vendors based in countries like India are comparatively cheaper when compared to that in US. Also India, being in a time zone that is approximately twelve hours ahead of US gives an added advantage as the team works while the attorneys in US sleep after a tiring day. Moreover, many of these vendors also work 24 X 7 which again proves advantageous for those based in US as the work is being continuously done and can be completed in half of the expected time. Thus outsourcing is the best alternative if one wants to get a quality output at a reduced cost and within a stipulated time frame.