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Correctly classifying workers can be a challenging task. Many companies assume that if a professional is open to functioning as an independent contractor, they have performed enough due diligence.

However, the proper classification of workers goes far beyond a worker’s willingness to be labeled in a particular fashion. There are strict legal guidelines regarding classifying those who contribute to your company and failing to adhere to the laws can lead to stiff penalties.

To make matters more complex, each state, along with the federal government, may use one of several tests to determine if a worker is an independent contractor. Since this can make the issue confusing, smart organizations are taking advantage of independent contractor validation services to stay on the right side of the law.

What is an Independent Contractor Validation Service?

Independent contractor validation services address one main concern: whether a worker is correctly classified as an independent contractor. They evaluate the relationship between the professional and the organization, assess the worker’s duties, and examine any additional expectations placed on them, following strict legal guidelines to make a correct determination.

Their goal is to see the situation as it is, making sure they don’t try to force a contingent worker into a box that doesn’t align with their role. This ensures legal compliance with worker classification standards, reducing risk for the organization dramatically. There are many benefits of hiring independent contractors over contingent or permanent employees, and confirming the proper employment status of these individuals ensures a positive outcome.

Why Use an Independent Contractor Validation Service?

When a company tries to determine whether a contingent worker can be classified as an independent contractor, it is often difficult. First, it’s hard for the business to ignore all of the benefits that can come from an independent contractor classification, like not having to withhold taxes or pay unemployment premiums. Adding many independent contractors can help a business grow its team in short order to act on pursuing the business’s goals and completing project needs.

The process of classifying a contractor can be challenging. Worker classification is a complex topic, and it’s easy to overlook a key point or misinterpret facets of the laws.

Finally, the financial penalties for misclassification can be severe. Fines can reach as high as 100 percent of the employment taxes that should have been collected, and those fines don’t include the taxes and insurance that should have been paid but weren’t.

Be Proactive With Independent Contractor Validation

By using an independent contractor validation service, you can ensure that workers are correctly classified, allowing you to reduce the stress of deciding and the risk associated with misclassification.

At nTech, we understand the nuances of employee classification. Our proven 80-point Independent Contractor Classification Questionnaire can help ensure your contingent employees are classified properly, whether as independent contractors or other kinds of workers.

Contact us to speak with one of our specialists today and see how our expertise and reliable ISO 9001:2015 certified process can benefit your business.

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