Independent Contractor status switched employee and loss of exemptions

UPDATED: Oct 1, 2022

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Independent Contractor status switched employee and loss of exemptions

I have been hired as an independent contractor for a national non-profit and work from home as they have no office locally. They are now requiring that everyone in my role become paid staff. They are offering the

same rate of pay but no compensation for the loss of the tax write-offs that I can currently take. I use all of my own equipment/computer/phone/car, etc. If I am an employee, wouldn’t they need to provide this equipment, supplies, etc., or at least provide a stipend amount for these or the use of my home office, utiliites, etc.? It seems unfair that I would need to cover all these costs and not have the ability to write this off especially since I am not making that much to begin with. I currently have to use my own credit card for deposits for events that I plan for them but as an employee, would they need to provide that for me as well? I would like to simply ask for fair compensation but not sure what they law would require of them or not.

Asked on September 26, 2017 under Employment Labor Law, Ohio


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

There is  no law requiring fair compensation or that an employer compensate employees for costs they incur or the loss of tax deductions. Employers can require employees to use or provide their own equipment (or internet, cell service, etc.) and do not have to provide stipends or reimbursements for it. They also not have to provide a credit card or otherwise pay upfront for events, but can require you to use your own card. Fair or not, wise or not, what you describe is legal--they can do this.
Of course, it's not all downside: they will pay the employer portion of FICA for you; you will be eligible for unemployment if you later lose the job; if they provide benefits to employees (e.g. health insurance, vacation or sick days, etc.), you should be eligible for those, too.

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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