In today’s “gig economy,” many people work as independent contractors, and they have no right to unemployment insurance, workers’ compensation benefits, or overtime pay. They also must pay all their Social Security taxes, which is twice what employed workers pay.
Writer misclassification is a real and continuing problem in New Jersey, just as it is around the country. To cut corners, employers increasingly are labeling workers as ‘independent contractors” whether that is the truth or not. As a result, many workers lose out on important rights, like those mentioned above.
If you believe you are being misclassified, contact a New Jersey employment lawyer today.
How Classification is Determined
There is no bright line between an employee and an independent contractor, and simply labeling a person as an independent contractor in a contract is not by itself sufficient proof. Different tests are used, depending on the circumstances. In New Jersey, workers are presumed to be employees unless they satisfy the ABC test, and a recent state bill codifies this test into law.
Under the ABC test, a worker is considered an employee unless the following are true:
- The worker is free from the employer’s control or direction over how they perform services
- The worker provides services outside the usual course of the business or the service is provided at a location off-site
- The worker is normally engaged in an independent trade, profession, occupation, or business
A writer should analyze their employment under this test. If an employer sets strict work hours and requires that you be on-site to perform your writing job, then you might be misclassified as an independent contractor. This means you could have rights to overtime or other pay.
A Stricter ABC Test
New Jersey’s proposed bill would be even stricter than the ABC test as explained above. In particular, the bill would eliminate the ability of an employer to satisfy the second prong by showing that the service is provided away from all of the places of the business. Instead, the only way to satisfy “B” is to show that the service is outside the core services offered by the employer. This and other changes could make it much harder for an employer to satisfy the ABC test, which would make many more people employees.
How Writers Are Affected
Many writers perform most of their work for a single content marketing firm, publisher, or magazine, which makes them look like employees. However, it is very easy to classify writers as independent contractors. A person can write almost anywhere, so an employer can have them work off-site and set their own hours, thus easily satisfying the ABC test.
Some writers oppose the changes in the law. They believe that if they are classified as employees, it will be much harder to find work. Of course, employers also could have an incentive to actually hire more part-time and full-time employees to write for them, which means more freelancers will now be salaried.
Has Freelance Writer Classification Cost You Money & Benefits?
Sattiraju Law has brought several important misclassification cases, and we are available to discuss your options with you. We also work with employers to make sure they closely follow state and federal law.
Contact us today to schedule a confidential consultation with a member of our team.
FAQs About Writer Misclassification in New Jersey
What is the ABC Test used to determine if a writer is an employee or an independent contractor?
In New Jersey, workers are presumed to be employees unless they meet all three prongs of the ABC Test: (A) the worker is free from the employer’s control over how they perform their services; (B) the services provided are outside the usual course of the employer’s business or performed off-site; and (C) the worker is customarily engaged in an independent trade or business.
Why do employers misclassify writers as independent contractors?
Employers often misclassify writers to save money and cut corners. By labeling a writer as an independent contractor, the company avoids paying for unemployment insurance, workers’ compensation benefits, and overtime pay. Additionally, independent contractors must pay the full amount of Social Security taxes themselves, which is double what an employed worker pays.
If I am a freelance writer working from home, am I automatically an independent contractor?
Not necessarily. While working off-site and setting your own hours can help satisfy parts of the ABC test, the determination depends on several factors, including whether the work you do is part of the employer’s core business. If you perform most of your work for a single firm and they exercise significant control over your output, you might be misclassified as an independent contractor and could be entitled to employee benefits.