Back in January, we published a “Tip of the Week” explaining the importance of properly classifying workers as independent contractors vs. employees. As we explained, Michigan courts (along with the IRS) have developed a very specific test with several factors to determine Contractor v. Employee status.
Take a look at this recent U.S. Court of Appeals-6th Circuit case, where the court applied the factors. The case was sent back to the lower court to have the facts re-examined to determine if the plaintiff was an employee or independent contractor. If it is determined that the plaintiff was an employee, the employer will have to compensate for overtime. The employer may be on the hook for for unpaid employment taxes as well. Click here to read January’s tip, posted on our Facebook page and here to read the case.
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