What to do if you do if you were an employee but called an independent contractor?

UPDATED: Nov 7, 2011

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What to do if you do if you were an employee but called an independent contractor?

My “employer” kept telling me they were going to make me an employee. I typed out and filled out my own job application and signed a W-2. I got the paperwork for them and registered myself as an employee with the state. They never made me an employee and now they say they are shutting down the business. My uncle told me that it is illegal to be an office manager sub-contractor and I don’t want this to affect me getting a new job. They seem all of a sudden that they are kind of shady and I don’t want them to screw me. What do I do now? I have not had any taxes taken out all year.

Asked on November 7, 2011 under Employment Labor Law, Ohio


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

It is not necessarily illegal to be an office manager as a contractor, but would have to be set up and run properly.

In terms of protecting yourself--file an estimated tax return and estimated tax payment. As long as the IRS gets the appropriate amount, you should be able to avoid personal liability for it not having been withheld by your employer. Speak with a tax preparer right away.

In terms of compensation to which you ay be entitled: if you should have been an employee (that is, you did not have the necessary "independence" to be an independent contractor; go to the Dept. of Labor website to see the standards for when someone is--and is not--an independent contractor), then the employer may owe you compensation: e.g. for the employer share of FICA, for any benefits you should have received as their employee, possibly for overtime, etc. Of course, if the are out or going out of business, it may be impossible to collect, but it would be worthwhile for you to consult with an employment law attorney about the situation.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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