INDEPENDENT CONTRACTOR | EMPLOYEE |
Generally provides services to more than one company | Usually works for only one employer |
Sets his or her own hours | Works the hours set by the employer |
Works out of his or her own office or home | Usually works at the employer’s place of business |
Does not receive employment benefits | Often receives employment benefits, such as health and disability insurance |
Works relatively independently | Works under the control and direction of the employer |
Incurs the costs associated with performing the job | Tends not to incur costs or make investments in the work |
Has acquired very specialized skills and comes to the work relationship with a particularized education or experience background | Has a general education and experience background, and receives special training from the employer in order to do the job better |
Is not subject to tax or FICA withholding, but pays his or her own self-employment tax | Receives net salary after employer has withheld income tax, Social Security and Medicare tax under FICA |
Is not eligible for unemployment compensation benefits | Is likely eligible to receive unemployment compensation after layoff or termination |
Is not eligible for worker’s compensation benefits | Will receive worker’s compensation benefits for any workplace injury |
Generally can be let go by the company for any reason, at any time | Generally can be terminated by the employer only for good cause and with notice |
Is paid according to the terms of the contract, and does not receive additional compensation for overtime hours worked | Is covered by federal and state wage and hours laws such as minimum wage and overtime rules |