Know the law: Independent Contractor & Misclassification
Independent Contractor & Misclassification: What you need to know
In New York, your job title doesn’t always reflect your legal employment status. Many workers are wrongly labeled as “independent contractors” when they should legally be classified as employees — a tactic some employers use to avoid paying fair wages, providing benefits, or covering taxes.
If you’ve been misclassified, you may be missing out on key legal protections such as minimum wage, overtime pay, paid sick leave, unemployment insurance, and workers’ compensation. This is known as worker misclassification, and it’s not just unethical — it’s illegal.
Even if your employer gave you a 1099 tax form or calls you a freelancer, that doesn’t automatically make you an independent contractor. What matters is how much control the employer has over your work, schedule, tools, and duties.
Why Classification Matters
Employees are entitled to full legal protections under New York and federal labor laws — including overtime, benefits, tax contributions, and anti-discrimination rights.
Independent Contractors typically do not receive those protections — but if you're misclassified, you may be able to recover lost wages, benefits, and damages.
Misclassification is especially common in industries like construction, delivery services, rideshare, hospitality, healthcare, and freelance creative work. If you're unsure whether you're properly classified, legal advice can help you find out — and take action if needed.
Over 1 in 5 workers in the U.S. is misclassified as an independent contractor.
Misclassified workers lose an average of 30% of their pay in unpaid benefits and protections.
NYC employers face millions in penalties each year for worker misclassification violations.
Independent Contractor & Misclassification: Most Common Issues
Denied Overtime or Minimum Wage:
Many misclassified workers are denied overtime or are paid below the legal minimum wage — even when they legally qualify for those protections as employees.
No Access to Benefits:
Misclassified workers often don’t receive health insurance, sick leave, paid time off, or retirement contributions — benefits that may be owed to them.
No Workers’ Compensation or Unemployment Insurance:
Being labeled a contractor can exclude workers from essential protections if they’re injured on the job or laid off unexpectedly.
Employer Control Doesn’t Match Contractor Status:
If your employer dictates your hours, work process, tools, and clients — you're likely an employee, no matter what they call you on paper.
Tax Burden Shifted to Worker:
Independent contractors are responsible for self-employment taxes. If you were misclassified, you may have paid thousands in taxes you didn’t owe.
Retaliation for Challenging Classification:
Workers who question their classification or assert their rights may face termination or reduced hours. This kind of retaliation is illegal and can result in legal damages.
Think You're Being Misclassified? You Might Be Owed Thousands.
Many NYC workers are labeled “contractors” when they’re legally entitled to employee protections — including overtime pay, benefits, and job security. Don’t let your rights be ignored. Find out where you stand and what you could recover.
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