Page 6 - White Paper-Independent Contractor Laws

rate) that s/he was ineligible for due to the classification as an independent

contractor.

Even assuming this person never worked overtime (which could add

substantially to the damages), there could already be a claim for almost $15,000 in

single damages, which if proven would then be tripled by the court.

Why do so many businesses get this wrong? One reason is the confusion

described above between the federal tax rules and the Massachusetts wage and

hour rules. Many businesses rely on their accountants in the first instance to “vet”

these decisions. This is entirely appropriate as it relates to taxes, but the

employment law analysis is a different animal.

Another reason is that violation of the Independent Contractor law is so

common that people assume it is acceptable because so many others are doing it.

Finally, in our experience many business owners are simply not doing the

math correctly, and assume that putting employees into W-2 status is more

expensive and burdensome than it really is. Yes, you do have to assume the

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