Am I considered an employee if I have been working as a 1099 contractor at the same business for 2 years?

UPDATED: Oct 1, 2022

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Am I considered an employee if I have been working as a 1099 contractor at the same business for 2 years?

I have been a 1099 contractor for the same employer for 2.5 yrs. 13 months
ago they gave me the opportunity to work full-time in-house, providing a
desk and specific hours, 40hr per week. I have an email stating after 90 days
I would become an employee and be brought onto house payroll. This never
happened so I continued to bill as a 1099 contractor. Now the employer
suggests they had never agreed to my billing terms and my supervisor let me
know the CEO is considering letting me go, thinking they have been
overcharged for services. In Aug 2016 I presented a proposal for working in-
house specifically, it did not include working out on locations which we do
several times a year. I billed location work differently than my office hours as
I remained a 1099 contractor. From what I understand I am not entitled to any
unemployment benefits as they never paid employment taxes on me. Am I
consider an employee and am I entitled to benefits?

Asked on September 24, 2017 under Employment Labor Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

Based on what you write, you were an employee: working hours set by the employer, at a location they determined, in their office, and (presumably) under their supervision (you reference your "supervisor") are all hallmarks of being an employee. If you meet the criteria to be an employee, it does not matter what they called you or how you billed:  the facts of the situation trump how it is described. You should be entitled to unemployment benefits; in addition you may be entitled to a certain amount of retroactive compensation, such as the employer share of FICA, which they should have paid for you; possibly overtime, if you would not have qualified as exempt from unemployment and ever worked more than 40 hours per week; possibly the cash value of any health insurance premiums they would have paid for you if you were an employee; etc. Try contacting your state department of labor file a "misclassification" complaint as well as to file for overtime if let go.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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