Can I hire multiple independent contractors to work on the same thing at the same time?
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Can I hire multiple independent contractors to work on the same thing at the same time?
I have a startup. In short, what I am trying to do is have independent contractors build the web product. My concern is around employee/independent contractor laws and other laws in general. Is it legal for multiple independent contractors to be working on the same exact tasks at the same time? Also, I prefer speed and high quality over costs. I am okay with paying 10 independent contractors, as an example to get a project done faster and of higher quality. But if their contract states when X project is complete, you get paid. Is that legal for all of them to get paid even if say 1 contractor didnt even do anything? Does that seem more like a team of employees than
independent contractors? Is it legal for them to communicate with each other to get the job done? I won’t be managing them, which I can only do with employees, but what if they manage/work with
each other? Is it legal for me to assign other contractors to basically assist or work with another contractor? When the IRS says you may not tell an IC What work must be performed by a specified individual. and What workers to hire or to assist with the work. This is very important for me to accomplish hiring multiple independent contractors fully legally. I understand the first response of any sensible person would be to say, No, I wouldn’t take the risk. Just hire them as employees. However, it is critical that I hire multiple independent contractors and need to figure out what is the best way to structure the independent contractor agreements and how best to
implement this.
Asked on November 15, 2016 under Employment Labor Law, Delaware
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 7 years ago | Contributor
Once you delineate how they must work together and have someone manage them for you (e.g. another IC), you are likely making them employees. To keep them independent, you can't tell them that they must coordinate and work together, because that is directing how they do the job. The structure you suggest is a structure for employees, not ICs, because you are providing direction and oversight for them--if not you personally or directly, then you via another I/C whom you put in that role. To have the project built by ICs, you need to hire a contractor (e.g. a software or web developer) and hire him/her/it (e.g. an LLC) to do the job to specifications, to a certain deadline, then step out of the way, save for periodic status/benchmark/quality checks, and let the I/C do the job however he/she/it wants--e.g. the I/C determines who to hire, how to manage, how many people (1, 2, 10 or whatever) are necessary, etc. But once you start assembling a team and being involved in setting how they function together, those are employees.
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