Many employment law disputes here in Houston stem from confusion about the classification of an employee. Employees have different rights than independent contractors, and while these differences are simple enough, they can become very complicated due to a number of factors. One issue is that workers who should legally be considered employees are often misclassified as contractors. Another issue applies to those who truly are contractors, and that is that they may have an employment relationship with two companies--one with a staffing company and another with the company for which they are actually completing work.
Whether a worker is an employee or a contractor has a great impact on his or her rights and benefits in the workplace. For example, under the Family Medical Leave Act, covered employers do have to provide employees with a certain amount of job-protected leave if they are having a baby or dealing with certain illnesses, but they may not have to hold the jobs of contractors who take leaves due to such obligations.
In order to determine whether a worker can legally be considered an independent contractor courts consider a number of things, including: who has the authority to fire the worker; which company pays the workers' wages; and who controls the worker's nature of work and hours?
In many cases, for FMLA purposes at least, courts find that staffing companies and employers are legally joint employers. In these cases, the employer who is using the staffing company's services may be obligated to provide contractors with a certain level of job-protected leaves.
This area of law is very complicated as there is no black and white test determining whether workers are employees or contractors. Rather, a number of factors must be reviewed and weighed on a case-by-case basis. Nonetheless, contractors do have legal employment rights and they may be wise to consult with employment law attorneys to learn more about these or discuss a dispute.
Source: Human Resource Executive Online, "Do Employers Have FMLA Obligations to Independent Contractors?" Keisha-Ann G. Gray, Dec. 13, 2012