 Learn about the pros and cons of hiring an independent contractor versus an employee.
Hiring an independent contractor (IC) has many advantages, but also some disadvantages. Before deciding how to staff a particular position, you will need to weigh the pros and cons and ensure that your selection will be accepted by state and federal auditors Benefits of Using Independent Contractors There are some big advantages to using independent contractors instead of employees, with financial savings at the top of the list. You will probably save money. While most employers pay CI per hour more than they would pay employees to do the same job, it often costs employers more to hire employees. When you hire an employee, you'll have to pay a number of costs that you don't have to pay credit unions, including employer-provided benefits, office space, and equipment. You will also need to make the necessary payments and contributions on behalf of your employees, including:
All together, these expenses can easily increase your payroll costs by 20% to 30% -- or more. You have flexible employees. Working with CIs allows employers more flexibility in hiring and firing workers, which can be especially beneficial for employers with fluctuating workloads. You can hire a microchip for a specific task or project, knowing that workers will be gone when the job is done. You won't have to deal with the potential injuries, costs, and legal issues that can come with layoffs and layoffs. You can also enjoy greater efficiency when using integrated circuits. Since most credit institutions bring specialized expertise to the job, they are often productive immediately, eliminating training time and costs. You reduce your exposure to lawsuits. Workers have many rights under state and federal law, so there are many legal claims they can bring against their employers for violating these rights. Because credit unions are independent traders, they are not protected by many of these laws. Among the rights available to employees but not to credit institutions are:
Employees can also sue their employer for unfair dismissal. ICs cannot bring this type of lawsuit Disadvantages of Using Independent Contractors After reading through the possible benefits of hiring a CI, you might think that you will never hire an employee again. But there are also significant limitations to the use of integrated circuits, and the risk is that your classification decision will be questioned by government agencies. You have less control over your workers. Unlike employees, whom you can supervise and keep a close eye on, independent contractors have a certain degree of autonomy in deciding how best to complete the task you have hired them to do. . If you interfere too much with an IC's work, you run the risk of making the IC look like an employee, who by law requires you to pay payroll taxes, workers' compensation insurance premiums, etc. If you want to have significant control over what and how your employees do it, categorize them as employees. Your workers come and go. Many employers only use CI when necessary for relatively short-term projects. This means workers are constantly coming and going, which can be frustrating and disruptive. And the quality of work you get from different integrated circuits can be very evident. Employers who want to rely on the same workers day in and day out are more interested in hiring employees than credit institutions. Your right to terminate your IC is subject to your written agreement. You don't have unlimited rights to enable ICs, like you can with your employees. Your right to terminate IC's services is limited by the terms of your written IC agreement. If you fire an IC in breach of the agreement, you may be liable for the breach of contract. You may be liable for injuries caused by CI on the job. Employees injured on the job are usually covered by workers' compensation insurance. In exchange for the benefits they receive for their injury, these employees waive their right to sue their employer for damages. Credit unions do not compensate workers, which means that if they are injured on the job, they can sue you and pay damages. You cannot own copyright to works created by IC. If you hire an IC to create a copyrightable work, such as an article, book or photograph, you may not be considered the owner of the work unless you use a written agreement to transfer ownership of the copyright from the IC to you. On the other hand, if an employee creates a work like this. So in most cases you automatically own the copyright. You are at risk with government audits. Federal and state agencies, especially the IRS, want to see as many workers as possible classified as employees, not ICs. The reason is financial: the more workers are classified as employees, the more tax and insurance money flows into government coffers, and the harder it is for workers to report or hide their income. them with the tax authorities. Some state and federal agencies may inspect your business if they believe you have misclassified an employee as a CI. At the federal level, you may face an audit from the IRS; The Department of Labor, which enforces federal minimum wage and hourly laws; The National Labor Relations Board, which advocates for workers' rights to form unions; or the Occupational Safety and Health Administration, a workplace safety law enforcement agency. At the state level, you may be able to bring to the attention of your state unemployment compensation or workers' compensation agency if a worker you have classified as an IC is claiming benefits. You may also face an examination from your state's tax office.
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 As anyone who owns a business knows – contracts are an indispensable tool to get things done and protect your business interests. However, if you don’t know anything about the laws that govern contracts, you may be doing more harm than good when you put pen to paper. Let’s talk through some of the basics of contracts and the law to make sure you have a good understanding of what’s at stake.
What Is a Contract? This is basically a legally-enforceable agreement between parties (two or more) that obligates both parties to fulfill particular things as specified within the contract. By party, this can mean a person, country, company, corporation, etc. What you want to keep in mind is that two things are always implied when the word contract is used: ●That there is an agreement made (something for something) ● The agreement is legally enforceable What Laws Pertain to Contracts? One thing about contracts is that the laws that govern them are determined by the state where the agreement between the parties was made. There may actually be a couple of types of state laws that govern the contract as well – depending on what type it is (e.g. property lease, sale of goods). For example, these are two types of law: 1. The Uniform Commercial Code or UCC: These laws govern contracts used for the sale of goods. The UCC is a standardized set of guidelines that oversee commercial transactions. While the code is not law itself, most states have adopted all or part of the code as law. 2. The Common Law: Other business contracts may be governed at least in part by “common law.” This includes all contracts like employment contracts, leases, etc. Each state has their own common law made from court decisions within the state over the years. How is a Contract Created? Any time an offer is made and accepted after a sufficient amount of “consideration,” a contract is legally valid. Let’s examine what these terms mean in the context of contracts: 1. An Offer: the terms of this offer must be clear and certain, and the party to whom such an offer is made must reasonably expect the offering party capable of the offer. 2. Acceptance: This is a clear expression from the party receiving the offer that they accept its terms and agree to it. 3. Consideration: There must be some gained and something obligated for all parties involved for the contract to hold. There must be an exchange of some kind of value. What Happens when a Contract is “Breached?” Anytime a dispute arises over a contract, one party may feel another party is failing to adhere to the terms of the contract they are obligated to adhere to. This is considered a breach and can result in legal action by the non-breaching party in an attempt to remedy the situation, which can happen in a number of different ways depending on the type of contract and breach. How Are Contracts Enforceable Under the Law? In the event that there is a breach of contract, the most common way to attempt to remedy the situation is to use a lawsuit through the court system.. However, there are other options for dispute resolution before turning to out-and-out litigation. These alternatives are mediation and arbitration.  Learn about your alternatives for generating money from family and friends to fund your business, including gifts, loans, and equity investments.
Small business loans are used by many small business owners to fund their operations. However, with the current tightening of lending rules, business owners may need to look for alternative sources of funding. Money from relatives and friends is a good source of company finance that is sometimes ignored. When it comes to soliciting money from friends and family, there are three basic financing options: gifts, loans, and equity investments. Learn everything you can about each one so you can make the best decision for you and your possible lender. Gifts from Family and Friends The simplest method of receiving business financing is through a donation. You are under no duty to the giver in the future (although you should thank the person and make an effort to maintain good relations). A friend or family member may provide a monetary donation to assist you in getting started, or you may initiate the process by asking. Though it may seem unpleasant to ask for money as a present, it can make sense when you're beginning a business. A letter noting that the money is a gift is all that is required to document a gift. For tax purposes, the giver should preserve a duplicate to prove to the IRS that the transfer was not an interest-free loan. You should also keep a copy. You can receive a tax-free gift of up to $14,000 per year from any one person. The giver must submit a gift tax return if you receive more than $14,000. (IRS Form 709, U.S. Gift Tax Return). The amount of the IRS gift tax exclusion varies each year; for the most up-to-date rates, visit the IRS website. Business Loans From Family and Friends The majority of money borrowed from friends or family is in the form of a loan. Someone provides you money, and you agree to repay it, usually with interest, over a defined length of time and under particular conditions. Documenting the Loan It's preferable to set up every loan the same way a bank would: with a documented agreement, known as a promissory note, and a payback plan. Following these business standards will give prospective lenders more trust, and these documentation will safeguard your lender from having the loan treated as a gift by the IRS. The written documentation should explain exactly when and how you're supposed to pay back the money, as well as what to do if you're late. The promissory note is legally binding once you've signed it. Choosing an Interest Rate Friends and family who lend you money are generally prepared to do so at interest rates that are lower than the market rate. They're probably more concerned with assisting you than with making a profit, and some may even insist on receiving no interest at all. However, as you prepare to approach potential lenders, keep in mind that you will have to pay interest for various reasons:
Considerations When Getting a Private Loan If you're considering a private loan, keep in mind that you'll have to keep track of it on a regular basis, usually through monthly payments. If your company isn't profitable, this may be challenging. However, if you can't meet your repayment commitments, your private lender is more likely to be flexible than a bank. However, before taking out a loan, you should think about whether you and your company can afford these monthly payments. Family and Friends as Equity Investors Selling shares in your company to a "equity investor" is a third approach to raise funds for your company. Although many firms seek professional equity investors, your friends and family members can also invest in your company as equity investors. How Equity Investments Work Unlike a loan, who provides you with funds to operate your firm temporarily, equity investors purchase a portion of your company. They become co-owners or shareholders in your company and share in its successes and failures. Raising funds for your company through stock investments differs significantly from borrowing funds. You'll need to do the following:
Compensating and Protecting Equity Investors Equity investors take a big risk by investing $50,000 or more in your company with no certainty that it will make money. Your investors should be aware that there is no certainty that they will get their money back. If your firm succeeds, equity investors will profit handsomely, making the risk worthwhile. If your company expands quickly, investors will make a lot more money than they would if they just gave you a loan and collected interest. Consider the following scenario:
Equity investors can also take steps to protect themselves as much as possible from business failure.
Sharing Ownership in Your Business When you invest in equity, you're dealing with a joint ownership situation. Your investors will have a say in how your firm is run. This isn't to suggest you shouldn't invest in stock, but you should be aware of what you're getting into. Documenting an Equity Investment To formalize an equity investment in your company, you'll need to produce an equity purchase agreement and other documentation. Because this paperwork is complicated and will define who owns and manages your firm, you should probably seek legal advice. You may also need to follow federal and state securities regulations, depending on how many investors you attract and how much money you raise. To guarantee that you comply with these rules and deal with the necessary paperwork, you will almost certainly need to engage an attorney. Finally, you should research how having investors will affect your tax filing, and you should notify your investors on the tax implications of their investments.  What are the consequences of using a convertible note instead of a conventional promissory note to borrow money for your company?
Convertible notes are promissory notes with a secondary business purpose other than debt representation. Convertible notes have all of the features of a standard promissory note, such as an interest rate and a security promise (if applicable). The difference is that under a convertible note, the lender (also known as the creditor or holder) has the option to convert all or part of the outstanding debt into the corporation's shares in specific situations When Would I Use a Convertible Promissory Note? It is commonplace for corporations to use convertible notes in business dealings. Here are a few likely scenarios:
Prepayment A convertible note, like a conventional promissory note, must deal with the question of prepayment. Having the option of making prepayments without penalty is usually in the best interests of the company. However, as with any loan, prepayment would prohibit the lender from getting the agreed-upon future interest payments. Furthermore, in the case of a convertible note, a lender may refuse to accept prepayment if it believes the firm has potential and would prefer to keep its options open to become a future stakeholder. Prepayment is a topic that must be discussed between the lender and the company, and it must always be addressed in the convertible note's terms. Treatment of the Note For accounting purposes, the outstanding balance of the loan is classified as debt, not equity, until the lender converts the note into company stock. This means that the lender normally has no stockholder rights, such as voting rights, distribution rights, and so on, until the note is converted. Triggers for Conversion The terms of the convertible note can provide that the loan is converted into stock based on a variety of triggering events, which can include the following:
The ability of the holder to convert the note into business equity is a significant issue that the company (as borrower) and the holder must carefully consider. Given that stock ownership is typically the primary means for a party to exert control over company management while also earning a profit, the holder will desire as much flexibility as possible when it comes to conversion circumstances. Similarly, the borrower will want to get as many conversion delays and/or constraints as feasible. Note that in the event of a liquidation, debt holders receive priority over equity holders in the distribution of remaining cash and assets, posing a danger to the creditor. As a result, if the debt is converted into stock, the holder will lose priority if the company is dissolved or declares bankruptcy. Methods of Conversion The next stage is to determine how many shares the debt is convertible into when the holder initiates a conversion. This is obviously important not only to the lender, but also to the remaining stockholders, who want to be as diluted as possible. In the calculation of outstanding debt, all methods of conversion commonly include accumulated and unpaid interest. The type of stock into which the note is convertible (whether common stock or a series of preferred stock) must also be agreed between the lender and the corporation. Keep in mind that the computations below may not always result in complete numbers of shares being issued to the lender, resulting in fractional shares. The convertible note's terms should state whether fractional shares should be rounded up to the next whole share or treated differently. The following are various options for calculating the conversion of outstanding debt into shares of the corporation:
Adjustments for Stock Splits or Recapitalization Note that the terms of the convertible note, including those for conversion, should be subject to change in the event of stock combinations, stock splits, or recapitalizations, unless doing so would be detrimental to the firm (as the borrower) or you (as a potential lender). 22/2/2022 0 Comments What Is Par Value Stock? Some states' company rules still require par value, which is an outdated legal and accounting notion.
The lowest legal price for which a corporation's shares can be sold is termed "par value," also known as "face value" or "nominal value." It has nothing to do with the real value or sale price of a corporation's stock. Rather, it is an out-of-date legal and accounting notion imposed by some state corporate laws When a corporation is created in some states, the articles of incorporation must specify a "par value" for its shares. Everyone, including the company's founders, who buys stock in the company must pay at least this amount. They will owe the corporation the difference if they pay less. For example, if the par value of your corporation's shares is established at $1, all stock buyers must pay at least that amount for each share they buy. If you buy 10,000 shares, you'll have to put down at least $10,000. If you only pay $5,000, your firm will owe you another $5,000. If your corporation subsequently falls out of business, its creditors may sue you to force you to pay the remaining $5,000 to assist pay off its obligations. The phrase par value is deceptive since it has nothing to do with the real value of a corporation's shares. It is simply a legal minimum value. The board of directors of a business may force investors to pay considerably more than par value for the company's shares. You might, for example, set a par value of $.01 per share while requiring investors to pay $10 per share. To put it another way, you have the option to sell your stock for whatever the market will bear. Your shares should be worth considerably more than their par value if your incorporated firm succeeds. Establishing Par Value of Corporate Stock The incorporators are in charge of determining the par value of the company stock. Large corporations often set a par value of one cent or a fraction of a cent per share. This allows them to issue a large number of shares without requiring the founders or other first purchasers to pay exorbitant sums of money. For example, Apple stock has a par value of $0.00001, whereas Amazon stock has a par value of $0.01. Small businesses that plan to have only one or a few shareholders may issue stock with a par value of $1. The par value of printed stock certificates should be printed on the certificate. When shares have a par value, the difference between the price paid by shareholders and the price paid by the business is accounted for as paid-in capital on the balance sheet. For example, if a shareholder pays $5 for 1000 shares with a par value of $1, the business will get $4,000 in paid-in capital and $1,000 in common stock. No Par Value Stock Some states allow for the issuance of company stock with no par value. The stock certificates should be produced with "no par value" in this case. Purchasers with no par value shares are not responsible to corporate creditors if they pay too little for the stock. Unless the business decides to designate a part to excess, the whole purchase price for no par shares is credited to the common stock account for accounting reasons. In some states, the stock must be allocated to surplus within a specific amount of time after it is issued, or it will stay as capital, limiting the company's capacity to make distributions or pay dividends. 18/2/2022 0 Comments Contract Breach: Material Breach How can you determine if your contract has been "irreparably violated" according to the law?
A "material" breach of contract is one that strikes so deeply to the heart of the contract (a failure to perform the contract) that it renders the agreement "irreparably broken" and negates the purpose of the deal in the first place. The break must go right to the heart of the parties' agreement. If there is a major breach (sometimes known as a "total" breach), the other party can simply terminate the agreement and seek damages from the other party in court. Courts frequently consult the Restatement (Second) of Contracts for aid in determining whether a breach is material, as well as other court decisions arising from contract disputes. The considerations listed below are generally relevant in establishing whether a contract breach was a substantial breach. Is the other party being denied "The Heart" of the bargain? For example, if the BMW dealer promised you a radio and stylish hubcaps, but the car you received lacked both, it is unlikely to be a significant breach because you were not deprived of the main goal of your deal—the car. You wouldn't be able to get out of the agreement (though you could demand the dealer remedy the situation in some way). A substantial breach would occur if a used-car vendor guaranteed you the exact Ford Mustang driven by Steve McQueen in Bullitt and then delivered a different Mustang. Your transaction wasn't about the make and model of the car in this case; it was about one specific vehicle. Is it possible to compensate the other party for their loss? Will money be able to address the problem, and if so, how much will it cost? It's less likely to be substantial if it can be repaired with reasonable effort or expenditure while the contract is still in place. Consider the BMW with no hubcaps and no radio mentioned earlier. Because the dealer could easily solve the problem by installing the promised features, you wouldn't be allowed to cancel the contract. What is the Loss (or Forfeiture) for the Breaching Party? What has the breaching party done so far to keep its end of the bargain? This aspect is frequently influenced by timing: how far along the parties are in carrying out their contractual responsibilities when the contract is breached. Consider a homeowner who commissions a custom kitchen from a contractor. If the homeowner announces a breach of contract when the kitchen is nearly finished, the contractor will lose a lot more time and money than if the breach was announced before construction began. If the majority of the contractual requirements have been met, you will be less likely to be able to claim a serious breach of contract and hence cancel the relationship. What Are the Chances of the Breaching Party Making Things Right? The less likely a violation of contract is substantial, the more likely the violating party can and will repair the problem. If the other party demonstrates that problems are likely to be resolved, such as by providing security for its promised payment or other reasonable assurance that it will honor the agreement, or if the economy or market shifts in favor of performance, the breach of contract is less likely to be material. Signs of financial weakness or payment defaults, on the other hand, indicate that the problems are less likely to be resolved (and make it more likely that you could rely on a material breach of contract to cancel the contract). Is it possible that the Breaching Party acted in bad faith? When a case is taken to court, the judge is more likely to presume a serious breach of contract if the breach was purposeful or came from bad faith or unfair dealing. An executive who was insubordinate and refused to obey directives, for example, was deemed to have significantly breached his employment agreement by a court. A breach caused by carelessness ("negligence") or circumstances beyond the party's control, on the other hand, is less likely to be considered a material breach of contract. Is the non-breaching party "ready, willing, and able" to fulfill its obligations? It's not enough to simply assert that the other party breached the contract materially. If the contract's responsibilities haven't been fulfilled yet, the non-breaching party must be "ready, willing, and able" to do so. For example, in one case, a New York man agreed to pay $610,000 for a "as is" vacation home. When the sellers refused to complete the transaction, the buyer sued for breach of contract. The buyer lost because he was unable to demonstrate that he was "ready, willing, and able" to fulfill the contract's requirements, which included significant modifications to the heating and plumbing systems. In other words, he refused to accept the house "as is." What Is In The Contract? Certain contracts specify what constitutes a significant breach of contract. Instead of relying on a judge's judgment or interpretation of the law in the event of a dispute, the parties might incorporate a phrase in the contract declaring that a breach of particular contract clauses will be regarded as serious breaches. For example, a provision may say that certain actions will be regarded as substantial breaches of the contract, such as failing to make payments, failure to retain insurance, or failure to meet specified sales targets. Because delays in performance and payment aren't always considered substantial breaches, some contracts include a clause that says "time is of the essence," implying that these types of delays will be regarded material breaches. 17/2/2022 0 Comments Contract Amendment Example Use this Sample Amendment if you're changing an existing contract.
This Sample Amendment to Contract can help you swiftly and painlessly incorporate any modifications to an existing agreement. In the "Completing the Amendment" section below, you'll also discover instructions on how to fill out the form. (See Nolo's article Amending an Existing Contract for more information on changing an agreement that's already in writing) Amendment to Contract 1. This amendment (the "Amendment") is made by _________________ and _________________, parties to the agreement _________________ dated (the "Agreement"). 2. The Agreement is amended as follows: ________________________________________________ 3.Except as provided in this Amendment, the Agreement remains in full force and effect and shall continue in accordance with its terms. If this amendment conflicts with the Agreement or any previous amendment, the contents of this amendment will take precedence. ____________________________ By: __________________________ Printed Name: _________________ Title: ________________________ Dated: _________________ ____________________________ By: __________________________ Printed Name: _________________ Title: ________________________ Dated: _________________ Completing the Amendment Here are some pointers on how to fill out the Sample Amendment and add it to your contract: 1. Introductory paragraph. The first paragraph is an introduction. Type your name or the name of your organization, as well as the name of the person on the other side (an individual or a company). 2. Describe the amendment. Type the changes to the original contract using one of three methods: redlines and strikeouts, completely changing a clause, or just summarizing the changes. Check out Nolo's article Amending an Existing Contract for more details on various amendment procedures. 3. The concluding paragraph. This paragraph (number three) should be added to ensure that the contract stays unchanged other than the adjustment. 4. Your amendment should be proofread and signed. Each of you should sign and write the date beneath the written party names. Each person's name and title, such as "Chief Operating Officer" or "General Partner," should be written below. You'll want to double-check that the individual signing the contract has the authority to do so, as well as that you've met any signing or notice requirements specified in the original contract. In most cases, any revisions must be signed by the contracting parties. Other signatures or notices may be necessary in some circumstances, such as corporate revisions or amendments to financial agreements. 5. Taking Care of Changes. Because contracts may be amended numerous times, it's a good idea to number each amendment, such as "Amendment No. 1" or "First Amendment." Furthermore, revisions should be submitted and kept with the original agreement so that anyone looking at the file may see that it has been changed.  When it comes to business and contracts, there are about as many different kinds as you could imagine. That’s because they are used for so many different things. Some are fairly straight forward and you can put them together yourself when you need them for your business.
On the other hand, others are somewhat more complex and are far more important to get absolutely correct. With such contracts, you may wish to enlist the services of an experienced business attorney who knows contract law and can make sure you are protected and that your contract is legally enforceable before it’s too late. Here are some great tips and helpful advice to make sure you are successfully using contracts as you should be. Tips on Negotiation One thing that’s good to keep in mind is that a contract is an agreement, and thus, there will always be a bit of negotiation involved. Therefore, it’s in your best interest (and the best interest of your business) to make sure you are negotiating properly and effectively. Here are some things you’ll want to keep in mind to ensure you do just that: ●Make sure you go into a negotiation with a clear objective. If you like, list out your goals. ●Research everything you need to know beforehand, including figures, facts, and relevant laws. ● Try to build some sort of trust between you and any other included parties. Trust is a great aid to effective communication. ●Decide beforehand what areas you are willing to compromise, but also make clear to yourself what is essential that you get from the negotiation. ● Listen to everything the other party says – don’t just wait for your turn to talk. ● Keeping everything ordered will help things proceed more effectively. Consider using a checklist or a first-draft of an agreement to facilitate this. Tips on Drafting a Business Contract There are some things you’ll want to keep in mind when it comes to drafting the language of your business contracts. It will help if you have a few things down first: ● Your contract needs to be focused, specific, and clear to be effective. ● Use short sentences to avoid ambiguity. ● Make sure everyone’s names are absolutely accurate or it won’t be legally enforceable. ● Define/stipulate each of the important terms you’ll use in your contract. ● Properly prepare for a dispute or litigation by specifying attorney fees, choice of laws, and should informal dispute resolution be preferred as a first step. ● Ensure everyone signs the contract. ● Number all of the pages so that it will be easy to see if pages were added/subtracted after a signing. ● You may want to review a sample contract or use a template to get started.  Learn about the pros and cons of hiring an independent contractor versus an employee.
Hiring an independent contractor (IC) has many advantages, but also some disadvantages. Before deciding how to staff a particular position, you will need to weigh the pros and cons and ensure that your selection will be accepted by state and federal auditors Benefits of Using Independent Contractors There are some big advantages to using independent contractors instead of employees, with financial savings at the top of the list. You will probably save money. While most employers pay CI per hour more than they would pay employees to do the same job, it often costs employers more to hire employees. When you hire an employee, you'll have to pay a number of costs that you don't have to pay credit unions, including employer-provided benefits, office space, and equipment. You will also need to make the necessary payments and contributions on behalf of your employees, including:
All together, these expenses can easily increase your payroll costs by 20% to 30% -- or more. You have flexible employees. Working with CIs allows employers more flexibility in hiring and firing workers, which can be especially beneficial for employers with fluctuating workloads. You can hire a microchip for a specific task or project, knowing that workers will be gone when the job is done. You won't have to deal with the potential injuries, costs, and legal issues that can come with layoffs and layoffs. You can also enjoy greater efficiency when using integrated circuits. Since most credit institutions bring specialized expertise to the job, they are often productive immediately, eliminating training time and costs. You reduce your exposure to lawsuits. Workers have many rights under state and federal law, so there are many legal claims they can bring against their employers for violating these rights. Because credit unions are independent traders, they are not protected by many of these laws. Among the rights available to employees but not to credit institutions are:
Employees can also sue their employer for unfair dismissal. ICs cannot bring this type of lawsuit Disadvantages of Using Independent Contractors After reading through the possible benefits of hiring a CI, you might think that you will never hire an employee again. But there are also significant limitations to the use of integrated circuits, and the risk is that your classification decision will be questioned by government agencies. You have less control over your workers. Unlike employees, whom you can supervise and keep a close eye on, independent contractors have a certain degree of autonomy in deciding how best to complete the task you have hired them to do. . If you interfere too much with an IC's work, you run the risk of making the IC look like an employee, who by law requires you to pay payroll taxes, workers' compensation insurance premiums, etc. If you want to have significant control over what and how your employees do it, categorize them as employees. Your workers come and go. Many employers only use CI when necessary for relatively short-term projects. This means workers are constantly coming and going, which can be frustrating and disruptive. And the quality of work you get from different integrated circuits can be very evident. Employers who want to rely on the same workers day in and day out are more interested in hiring employees than credit institutions. Your right to terminate your IC is subject to your written agreement. You don't have unlimited rights to enable ICs, like you can with your employees. Your right to terminate IC's services is limited by the terms of your written IC agreement. If you fire an IC in breach of the agreement, you may be liable for the breach of contract. You may be liable for injuries caused by CI on the job. Employees injured on the job are usually covered by workers' compensation insurance. In exchange for the benefits they receive for their injury, these employees waive their right to sue their employer for damages. Credit unions do not compensate workers, which means that if they are injured on the job, they can sue you and pay damages. You cannot own copyright to works created by IC. If you hire an IC to create a copyrightable work, such as an article, book or photograph, you may not be considered the owner of the work unless you use a written agreement to transfer ownership of the copyright from the IC to you. On the other hand, if an employee creates a work like this. So in most cases you automatically own the copyright. You are at risk with government audits. Federal and state agencies, especially the IRS, want to see as many workers as possible classified as employees, not ICs. The reason is financial: the more workers are classified as employees, the more tax and insurance money flows into government coffers, and the harder it is for workers to report or hide their income. them with the tax authorities. Some state and federal agencies may inspect your business if they believe you have misclassified an employee as a CI. At the federal level, you may face an audit from the IRS; The Department of Labor, which enforces federal minimum wage and hourly laws; The National Labor Relations Board, which advocates for workers' rights to form unions; or the Occupational Safety and Health Administration, a workplace safety law enforcement agency. At the state level, you may be able to bring to the attention of your state unemployment compensation or workers' compensation agency if a worker you have classified as an IC is claiming benefits. You may also face an examination from your state's tax office. |
AuthorYoel “Mo” Molina, I am a lifelong resident of Miami, Fl. I am a graduate of Miami Senior High, Class of 1992, Georgia Institute of Technology, B.S. 1997 and University of Maine School of Law, J.D. 2001. I have been practicing law in Miami Since 2001. I am a former training prosecutor in the Miami-Dade State Attorney’s Office. I have experience in jury trials, appeals, and administrative hearings. I have appeared before judges across the State. My experience ranges from civil litigation matters, collection matters, foreclosure, business and corporate, contracts, real estate, leases and employment matters.. Archives
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