Can Your Independent Contractors be Deemed to be Employees?

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From The National Law Review —

“New Jersey courts have consistently found that independent contractors are not deemed employees under the LAD, and are therefore not entitled to its protections. When courts must determine whether a claimant is an employee or an independent contractor, they generally consider factors set forth under New Jersey case law (Pukowsky v. Caruso, 312 N.J. Super. 171 (App. Div. 1998)), which closely parallel those established by the IRS. Pukowsky identifies the following 12 factors relevant to determine whether a worker is an employee or an independent contractor.

(1) The employer’s right to control the means and manner of the worker’s performance;

(2) The kind of occupation—supervised or unsupervised performed by the worker;

(3) The level of skill needed by the worker for the task;

(4) Who furnishes the equipment and workplace;

(5) The length of time the individual has worked for the employer;

(6) The method of payment;

(7) The manner in which the work relationship can be terminated;

(8) Whether annual leave is provided to the worker;

(9) Whether the work is an integral part of the employer’s business;

(10) Whether the worker accrues retirement benefits;

(11) Whether the employer pays social security taxes; and

(12) The intention of the parties concerning the relationship.

Although the employer’s right to control the means and manner of the worker’s performance is usually given greatest weight, the circumstances of each case require a principled application of all of the factors.”

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