What is an Independent Contractor

What is an Independent Contractor?


Independent contractors work for themselves — they are treated as if they are running their own business. Thus, you are not the employer of an independent contractor, and you aren’t liable for payroll taxes or benefits for them, nor are they protected by workers’ compensation or most labor laws. Independent contractors control the performance of the work based on their experience, special license, or special education or training required for the job. In most cases, you tell them the outlines of the project that needs to be done and the due date, and they determine how to accomplish it, on their own schedule. The independent contractor provides the knowledge, experience, and labor to perform the job or provides other individuals to perform the job contracted. Independent contractors are usually paid based on their results (i.e., a flat rate per job, or a per-unit-completed rate) rather than the time they put in. You will be required to sign a statement of understanding that is part of your independent contractors agreement.