California (2021, October 12) - In California, AB5 helps to classify independent contractors and employees. This law came out on January 1 in 2020.

Independent contractors in California are not eligible for workers' compensation benefits. They perform work outside of the business on an independent basis and have no connection to human resources. Employees, on the other hand, worked at the company and went through a hiring process. They have to receive workers' compensation insurance when facing a workplace injury.

To make it easy to remember, most individuals who work for a gig-based job are independent contractors. They often do not have to pay tax until the end of the year. Independent contractors do not have access to retirement, private insurance policies, or unemployment options.

As mentioned, not only do independent contractors not have rights to benefits, they also do not pay taxes until the end of the year. The IRS has determinations to help businesses determine the status of their employees or workers. Employers must look into the relationship they had with the individual from when they joined the company.

Under IRS classifications, an employee is an independent contractor when there is a lack of employer control. Employees also have a set wage, while the former does not. An independent contractor's contract also does not list out the benefits they will receive.

Sometimes, employers try to avoid offering workers' compensation benefits by labeling their employees as independent contractors. If there is misclassification, the IRS will charge penalties in taxes. They will have to file new paperwork with the government with a timeline that they would have to offer their employees benefits like workers' compensation.

If your company mislabeled your job role and if you faced a workplace injury, a workers' compensation attorney San Diego at Rawa Law Group is ready. This legal team has a focus on compassion and wants to help every client receive their benefits. You deserve to heal without added stress.