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What is the difference between a non-Employee contractor and an Independent contractor?

Dallas, TX |

Is there a legal difference at the Federal or state level between a worker who is not an employee and just a contractor, and that of an Independent contractor? Why is it that some contractors are given form W-4 while independent contractors are given W-9? Does the distinction come from if the worker is working for a company via going through a staffing agency or not?

Attorney Answers 3

Posted

A W-9 is given to Independent Contractors, which is anyone who performs work without being hired as an employee. People who get jobs through a staffing agency are employees of the staffing agency until some contractual period of time has passed, and as such would be given a W-4 from the staffing agency.

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Posted

Some for example if I was hired on to a very small company (basically just the owner himself) and told that I'm hired on as a "contractor" and not an "employee"... does that automatically make me an independent contractor if I am NOT going through any sort of staffing agency? Are there TWO type of contractors? Regular and Independent?

Nathaniel John Oleson

Nathaniel John Oleson

Posted

Yes, if you are not being hired as an employee you are an independent contractor, which means that you are responsible for paying all of your own taxes. When you are told that you are being hired as a contractor and not as an employee it means that you are hired as an independent contractor.

Nathaniel John Oleson

Nathaniel John Oleson

Posted

I should note that you may want to speak to a labor and employment attorney if you think you are being managed like an employee. It is improper for an employer to classify you as a non employee if that is the situation, but you would want to speak to an attorney for more information.

Posted

Texas has different classifications of non-employees depending upon the type of company you work for. If you work for a staffing company, you are referred to as a "temp" or "temporary employee" and are assigned to the client company for a short period of time. The staffing company is your employer.
If you are assigned to a client company for a long period of time, you may be a "leased employee" and the company you work for may be a Texas-licensed staff leasing company. There are also co-employment and joint employment arrangements in which the client company and staffing company mutually decide which party will be responsible for certain employment functions. The Texas Workforce Commission website has legal descriptions of the different types of non-employee arrangements in addition to a description of independent contractors.

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Posted

In Texas it is very difficult to classify anyone as an independent contractor if they are told when to work, where to work, and provided what they need to do the work. Even if they only do the work for a short period of time, they would be an employee.

DISCLAIMER: This is not specific legal advice and does not establish an attorney/client relationship.

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