Have you ever heard someone say, “The definition of insanity is doing the same thing over and over and expecting a different result“? That’s just wrong. No, it’s insanely wrong. (Irony! Actual definition, click here).
If you flip a coin 5 times and it comes up heads each time, is it insane to think it might come up tails next time?
If you play golf in a lightning storm five times and never get hit, is it insane to think you might get a nice electrical jolt next time?
If you root for the Browns to win a football game and they never do, is it insane to think they never will? [Note to self: Delete that. Bad example. It is true that they might never win a game. Shameful admission: I am a Browns fan.]
My consistent advice to companies that use independent contractors is to be proactive. Review your policies, practices, and documents now — before you get sued or audited. Many take this advice. Those who do not generally give two reasons:
We don’t want to spend the money now; and
We’ve always done it this way and have never been sued.
What is a “temporary employee”? I have practiced employment law for 20 years (Note to self: Keep practicing; someday you’ll get good at it.) and I can’t tell you. It’s a state secret. All lawyers have been sworn to secrecy forever.
Either that or, if you really want to know and say “pretty please” (with or without sugar on top, but no artificial sweetener please), that term has no legal significance. Usually the term is used to mean one of two things:
your employee, hired on a trial basis with some sort of probationary period; or
a staffing agency worker, retained to augment staff levels on a temporary basis.
Under option 1, the “temp” is a regular W-2 employee of yours, probably employed at will like your other employees, but whether you call that person “temp” or “permanent” or “regular” or “irregular” (?), none of it matters. A temp worker who is your employee, paid subject to deductions, is your employee. Temp time counts toward FMLA eligibility. Continue reading →
Among James Bond films, Rotten Tomatoes ranks Never Say Never Again 18th out of 26, with a mediocre 63% rating. (Bond movie quiz at the end of this post, for patient readers.)
It’s a cliche saying, I know, but my first reaction when asked this question was, “I’d never say never, but it’s hard to imagine a scenario where that would work.” (That was also my second reaction and my third. Let’s just say that’s my reaction.)
Let’s run this through the gauntlet. Remember, it’s not your choice whether an intern is an independent contractor or an employee. The law decides that for you, based on the nature of the relationship.
ADA Quick Quiz: Your company uses staffing agency workers. A staffing agency worker discloses a medical need and asks for a reasonable accommodation — maybe a computer screen reading program, or an ergonomic chair, or a modified work schedule.
1. Which company must have the interactive conversation to determine what reasonable accommodation is appropriate?
(A) Your company
(B) The staffing agency
2. Which company is obligated to provide the reasonable accommodation?
(A) Your company
(B) The staffing agency
3. Which company is obligated today for the reasonable accommodation?
Photo of Singer Dave Mason (We Just Disagree), by Alan Hurtock
Let’s start with this: Everyone is happy being an independent contractor until they’re not.
What do I mean by that? Right now, the relationship works. The contractor performs, and you pay for the work.
But what happens when things go south? As soon as you decide you no longer need those services, the contractor might stop being your BFF.
A disgruntled former contractor has some options, all of which involve some variation of this story: “Once upon a time, I was misclassified and should have been an employee.” None of the former contractor’s possible next steps are good for you: Continue reading →
Retaining control over how independent contractors do their work can sink an otherwise legitimate independent contractor relationship.
Fortunately, steps can almost always be taken to give up aspects of control that do not hurt the business case for using a contractor instead of an employee. Companies need to be thoughtful and proactive, though, in evaluating and modifying these relationships — before they are challenged in a misclassification claim.
Here are four aspects of control you may be able to relinquish in your relationships with independent contractors: Continue reading →
A client once asked me to review the Employment Agreement of a candidate they were considering hiring. The candidate had recently been terminated but his Employment Agreement contained a 12-month non-compete, and my client’s job offer seemed pretty clearly to be for a competing job.
But the terminating employer made once huge mistake. When it meant to terminate employment, instead it terminated the agreement … and with it, the non-compete. Oops!
I see the same mistake in Staffing Agreements and Professional Services Agreements all the time.
These agreement are usually intended to serve as Master Service Agreements (MSA), with additional work orders to govern the actual services to be provided. These MSAs contain very important clauses that are intended to survive, even after the services have stopped. Examples of clauses intended to survive the termination of services include indemnification, insurance coverage, preservation of confidential information, and right to audit.
The mistake I see over and over, however, is the inclusion of a termination clause that allows for termination of the agreement, not merely termination of services.