In October, an Illinois federal court found that a building maintenance worker employed for twelve years had been improperly classified as an independent contractor, and that his employer thus failed to pay him overtime in violation of the Fair Labor Standards Act and state minimum wage law.
The employer in question monitored the quality of his work, disciplined him whenever his work fell below expectations, paid the worker a regular salary, withheld taxes, and reported his earnings via a W-2, specifically indentifying him as an employee.
OK, I could see failing to pay overtime in such a case for, say, three or four years--but twelve years, c'mon. On the other hand, given that the employee had also lived in lodgings provided by the employer and that the worker alleges having worked an average of 66 hours per week, it's entirely possible that the employer felt he qualified, under common law, as a serf. These things can be very grey areas.
Happily, there is however a simple six-factor test that employers can use to help to determine whether someone is an employee or an independent contractor, and it was indeed these six factors that the court considered in this case:1) the nature and degree of the company's control over the manner in which work is performed; 2) the opportunity for the worker to obtain a profit or loss; 3) the worker's investment in equipment or materials; 4) the requirement of special skills for the worker's duties; 5) the permanency and duration of the parties' working relationship; and 6) the extent to which the worker's duties constitute an integral part of the alleged employer's business.
That's a good list to keep in mind... Beyond that simple test, there is also always professional advice when it's really a tough call.