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This Worker Classification Myth is Hurting Your Business

4.22.16

Sorry, y’all: The five-second rule is bogus. Germs don’t offer a grace period before jumping on your food. Not even your last bite of the really delicious stuff. But that one about metal objects dissolving in a glass of Coke? Still up for debate. And we won’t be testing it to find out.

Myths can be dangerous, silly, or in the case of worker classification—bad for business.

There is a fine line between an employee and an independent contractor and laws surrounding worker classification are confusing. We’ve seen companies go to great lengths to comply with nonexistent rules, so we were compelled to bust one of the most damaging worker classification myths we’ve seen.

The Myth About Worker Classification

After a certain amount of time working for you, an independent contractor must be reclassified as an employee.

We think this myth likely comes from one-time best practices that were interpreted as hard and fast rules. Wherever the myth comes from, we’ve seen clients build all sorts of policies to get around the supposed law. We’ve seen them hire workers for six months, drop them for a period of time, and then rehire them, for example. Some companies even refuse to rehire independent contractors after working with them for a certain amount of time because they’re afraid they’ll have to provide all of the benefits associated with hiring an employee. Not only are these policies time consuming, they can hurt businesses that rely on trustworthy freelancers.

The Truth About Worker Classification

We think it’s time for everyone to bust the myth and bust free from self-imposed restrictions.

Here’s the liberating truth: If you find a good contractor and want to use them over and over, you can. There are rules, which vary by location, but there are also legal ways to keep your best people working for you.

If you’re confused by compliance laws and fear your workers are misclassified, PayReel can help. Reach out to our team of experts on all things freelance. Get away from the burden of onboarding, payrolling and classifying your workers and focus on what you love.

About PayReel:

PayReel’s clients, who are some of the biggest companies in the world, are constantly immersed in the chaos of producing multimedia content or executing live events. PayReel makes sure they have the right contractors at the right time in the right place, and that everyone gets paid properly. And, most importantly, they handle every last detail perfectly while making sure their clients think nothing of it, so they can get back to doing what they do best.

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