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Independent Contractor Verses Employee Determinations

Independent Contractor Law in Georgia

Employers often have to determine whether the person they are hiring is an “employee” or an independent contractor. The law provides guidelines to determine whether someone qualifies as an independent contractor, but applying those rules to specific situations can be confusing.

The Reddy Law Firm, P.C. represents businesses and individuals alike in negotiating, drafting, and defining various employment and work-for-hire agreements. We understand the various benefits and responsibilities inherent in each type of relationship, and we know how important it is that both parties protect their interests in the agreement.

When examining “employee vs. independent contractor” matters, it’s critical that you make an informed decision. Error can result in serious and unforeseen consequences, ranging from higher income taxation to liability for damages. An experienced Atlanta employment law attorney can help.

Defining an Independent Contractor in Georgia

State law and IRS guidelines both apply to the “employee vs. independent contractor” question. Unfortunately, there is no black-and-white rule to define the difference. Instead, businesses must weigh various factors and consider the overall nature of the relationship.

To determine if someone qualifies as an independent contractor in Georgia, consider the following factors:

  • Which party determines the tasks that are to be performed?
  • Is the worker free to set his or her own working hours?
  • Does the worker receive “employee”-type benefits (e.g. health insurance, pension plans, medical leave or vacation pay, etc.)?
  • How, and on what schedule, is the worker paid?
  • Does the worker provide his or her own equipment/tools?
  • Does the worker receive reimbursement for out-of-pocket expenses?
  • Is there a signed “Employment Agreement” or “Independent Contractor Agreement”?
  • Are the worker’s services part of an independent business, occupation, profession, or trade?
  • Did the worker receive training?
  • How many hours does the worker spend on the job each week, and how long does the relationship last?
  • Does the worker decide where he or she will work? Must it be on the employer’s premises?

These are just a few of the relevant inquiries, and none of them are determinative on their own. Parties are sometimes surprised to learn that their relationship isn’t what they thought it was, at least in the eyes of Georgia employment law or the IRS.

How an Atlanta Employment Law Attorney Can Help

Balancing these factors isn’t easy. Working relationships often fall somewhere in the middle, with some factors pointing toward “employee” and others toward “independent contractor.” An Atlanta employment law attorney can draw on years of experience to help you understand how the various factors might apply.

Likewise, if you already know that you want your agreement to constitute one or the other, a lawyer can help you draft the terms of your agreement in order to resolve the “employee vs. independent contractor” debate at the outset.

Defining Employee Status

If you have questions about hiring or working as an independent contractor in Georgia, contact attorney K.P. Reddy today at (678) 629-3246.  Our firm has years of experience in negotiating and executing employment and IC agreements for clients throughout the state of Georgia.

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  • Alpharetta Office
    11175 Cicero Drive
    Suite 100
    Alpharetta, Georgia 30022
    Phone: 678-629-3246
    Fax: 678-629-3247