Your employer may misclassify you as an independent contractor. This denies you essential workplace protections, robs you of unemployment and workers’ compensation, and reduces tax revenues. Jobs should provide stability and respect, enabling you to support yourself and your family. Unfortunately, corporations are shifting risk and costs onto you while prioritizing their profits.
If you were hurt at work, and believe you’ve been misclassified, reach out to Chute, O’Malley, Knobloch, and Turcy, LLC at (312) 775-0042 for assistance in seeking compensation.
Why Employers Misclassify Workers as Independent Contractors
Misclassification happens when you, as an employee, are incorrectly labeled as an independent contractor by your employer. This is an issue that occurs frequently. Research indicates that in some states, 10–30% of employers may misclassify their workers.
The way you are classified can have consequences for your labor rights and financial stability. Employers in Illinois might classify you as an independent contractor to dodge responsibilities like payroll taxes, unemployment insurance, workers’ compensation, and even minimum wage laws. Independent contractor misclassification also allows them to skirt around laws related to overtime, benefits, and anti-discrimination protections, enabling businesses to cut costs and reduce the administrative work involved in hiring.
There are several reasons this misclassification occurs:
- Cost Savings: By misclassifying you as an independent contractor, employers can avoid contributions to Social Security and Medicare, along with unemployment taxes and workers’ compensation.
- Avoiding Labor Laws: When you’re labeled as an independent contractor, employers can evade their legal obligations, such as paying minimum wage and adhering to overtime laws or protections against discrimination, as these laws are built around traditional employer-employee relationships.
- Reduced Benefits: Generally, independent contractors don’t receive health insurance, pension plans, or paid leave from employers, allowing companies to save on benefits that would typically be provided to full employees.
- Flexibility: Misclassification gives employers a more adaptable workforce, enabling them to quickly adjust their staffing levels based on demand.
- Thwarting Unionization: By misclassifying workers, employers can undermine union efforts or weaken bargaining units, since independent contractors fall outside the protections of the National Labor Relations Act.
Understanding the difference between true independent contractors and those misclassified as such is important. Misclassification means that employees lose essential workplace protections, like union rights, and face higher taxes without benefits like overtime pay or unemployment insurance. It also leads to lost tax revenue for government agencies as employers avoid their obligations.
Employee vs. Independent Contractor
The distinction between an independent contractor and an employee hinges on the employer’s control over the work. Employees typically have set hours, follow specific processes, receive tools from the employer, and generally work exclusively for them. In contrast, independent contractors enjoy more freedom, setting their own schedules, choosing how to complete tasks, using their own resources, working for multiple clients, and managing their own taxes without withholdings.
How Employee Misclassification Affects Workers’ Compensation Claims
Misclassification as an independent contractor means you bear the full cost of Social Security and Medicare, and no contributions are made to unemployment insurance or workers’ compensation. In Illinois, getting categorized as an independent contractor can result in not having workers’ compensation and, therefore, a workers’ comp claim denial, as such coverage is intended for employees, not independent contractors.
Workers’ Compensation Rights for Misclassified Employees
If you’re misclassified as an independent contractor in Illinois, you typically have workers’ compensation eligibility for job-related injuries and other benefits under state and federal laws. You can address the issue through the Illinois Department of Labor, the IRS, or by suing your employer. The Illinois Workers’ Compensation Commission (IWCC) evaluates your status based on factors related to your relationship with the employer.
Filing an Employee Classification Complaint
You can file complaints either electronically online or on paper, whether for yourself or for a worker you think has been misclassified. When you submit a complaint to the Illinois Department of Labor, it will be forwarded to the Illinois Department of Employment Security, the Illinois Department of Revenue, and the Illinois Workers’ Compensation Commission. This allows those agencies to investigate violations of employer requirements.
If you’re providing services for a construction contractor, you’re generally considered an employee of that contractor unless you meet specific criteria outlined in section 10 of the Employee Classification Act.
How a Naperville Work Injury Lawyer Can Protect Your Rights
If you’ve been injured at work and were misclassified as an independent contractor, a Naperville work injury lawyer can help protect your rights as an employee. They will demonstrate how you meet the criteria for employee status, allowing you to pursue compensation for lost benefits like overtime pay, leave, and severance.
Your Naperville workers’ compensation attorney will assist you in gathering evidence by collecting important documents such as contracts, pay stubs, and communications with your employer that highlight your role as an employee. They will assess your situation according to both Illinois and federal guidelines to determine if you’ve been misclassified.
Your attorney can help prepare and file a complaint with the Illinois Department of Labor or the Illinois Workers’ Compensation Commission. They will also guide you in filing claims for benefits you may have been denied.
If you find yourself in this situation, contact us at Chute, O’Malley, Knobloch, and Turcy, LLC. We’re here to navigate the benefits available to you, conduct an investigation of your case, and support you in seeking compensation.
Frequently Asked Questions
Who Can File a Misclassification Complaint?
Any interested party can file a misclassification complaint, including the affected employee, other employees or employers, labor organizations, or the Department of Labor.
What Happens After a Complaint Is Filed?
After a complaint is filed, the Department investigates and issues findings with recommendations. If an employer does not comply, the case is referred to the Attorney General for court action.
Can I Be Fired for Filing a Complaint?
It’s illegal for an employer to retaliate against anyone for exercising their rights under the ECA.
