Are you an ’employee’ or an independent contractor?

Classifying workers as employees or independent contractors can be complicated in Kentucky. The current federal system lacks clear definitions as the IRS, National Labor Relations Board and U.S. Department of Labor have their own rules to classify workers.

Worker classifications matter as traditional employees have distinct advantages concerning taxes and subsidized benefits as well as numerous federal and state labor protections. Independent contractors usually aren’t eligible for overtime pay, health insurance or other benefits and can’t collect unemployment compensation if they lose their jobs.

Kentuckys definition of an independent contractor

The state applies Kentucky Unemployment Compensation laws and regulations to determine the classification of workers. According to the state, an independent contractor is someone who:

  • Performs a job that is not similar or connected to the employer’s business
  • Employers have no direction or control over their work

Tests used to determine a workers classification

The Kentucky Office of Unemployment Insurance uses several criteria to ascertain whether a worker is an employee or an independent contractor, including:

  • Right to control test: The employer answers several questions to determine whether they are able to control the worker’s hours, work environment and other factors.
  • Nature of business test: The state can classify the worker as an employee if he or she is performing work that would otherwise be performed by a company’s employees.

Know your rights if you are an independent contractor

Many companies hire independent contractors to avoid paying taxes and benefits as well as unemployment insurance. If you have lost a job and feel you were mistakenly classified as an independent contractor, an experienced employment attorney here in Kentucky can help you recover the benefits and compensation you deserve.