In two 2014 decisions, the Colorado Supreme Court found that an assessment of all the circumstances was necessary to determine whether a worker «usually practices a profession, profession or independent business.» There is no smoke gun and not a single factor correctly classifies a worker as an independent contractor. Until the Department of Labor and Employment has sufficiently demonstrated that individuals are free to direct and control how a particular service is to be provided, it is considered that these individuals are employees under Colorado law, whether or not they meet the general minimum requirements for workers. The evidence must show that persons in an independent profession, profession or profession are related to the service provided. As such, the State of Colorado requires organizations to pay independent contractors in the same way they do employees, as well as other related services, until they can prove otherwise. This means that they must also pay an employment tax of between 7.65 and 15% and withhold taxes on workers. In addition to the above requirements, the independent contractual agreement must include a bold or large-scale statement indicating that the worker is not entitled to the work allowance and that the worker is required to pay federal and national tax on income collected under the agreement. If you need help with an independent contract, you can publish your legal needs in the UpCounsel marketplace. UpCounsel only accepts the highest 5 percent of lawyers on its website. UpCounsel`s lawyers come from prestigious law schools like Yale Law and Harvard Law and typically have 14 years of legal experience, including working on behalf of or with companies like Airbnb, Menlo Ventures and Google.
The principles in force thousands of years ago are still applicable today. However, the current business environment is a little more complex and existing regulations are constantly evolving to keep pace with the dynamic landscape. The relationship between a person or company working for pay («worker») and a person or company for which the worker provides services («company») is regulated by many agencies at the national and federal level (including the Independent Tax Office, the Department of Employment, the Securities and Exchange Commission, the National Labor Relations Board, public unemployment insurance agencies , public compensation agencies). , public ministries of income, public employment agencies and employment agencies, to name a few). The law, tests and analyses of this relationship differ depending on the nature of the investigation or act and therefore the agency and the jurisdiction. Therefore, the guidelines for determining whether workers are workers or contractors are more complex than in Roman times. Taking the time to properly classify employees working for your company is essential to risk management. Poor classification of workers can lead to a large number of legal issues, some in the hands of the poorly ranked worker and some by the regulatory authorities responsible for the protection of workers and the application of these countless rules.
Classification also helps companies determine the applicability of labour laws, correct tax retention practices, compliance reporting obligations, available payment options and other general recruitment practices that may reduce your company`s legal risk.