Starting a new business or joining a currently existing business can bring a few challenges. One challenge that arises comes from the hiring process. There are multiple types of workers that can work for you. These can include Full-time Employees, Part-time Employees, Interns, and Independent Contractors.
It is extremely important to understand the subtle nuances that separate each of these categories. It is also required that you periodically notify those working for you of their current employment status, whether they’re full-time or part-time, if they are an independent contractor or not, etc.
Employees: Full-time and Part-time
According to the New York State Department of Labor, an employee can be defined as “any person employed for hire by an employer in any employment.” There are two main types of employees: full-time and part-time. Full-time employment in New York is generally defined by the employer, particularly for benefit purposes. An employee of the company that accrues over 40 working hours in a single payroll week is entitled to overtime pay. A part-time employee is one that works under the employer-defined full-time requirement, or 40 hours in a given work week, if not otherwise defined. Each employee, regardless of full-time status or part-time status, must be paid the minimum wage. In New York State, the minimum wage rate varies, depending on the geographic area you live in or are working in.
Some employees are also eligible for fringe benefit packages or wage supplements. Most of the time, benefits and wage supplements are reserved for those in full-time employment status, and here is where the employer-defined full-time hours requirement is important. Some employers define full-time as 35 or even 32 hours per week. There is no particular legal requirement in New York State, nor is there any sort of statute in place that demands that employers provide benefits or wage supplements regardless of full- or part-time status.
Interns
Interns are a unique type of worker that can either be paid for their work or not. Interns usually perform tasks that align with their area of course study in a two-year or four-year college or university. Interns may opt for the unpaid option in order to gain the knowledge for their continued coursework and to gain college course credit for advancement in their studies. However, not all interns are unpaid. Employers may offer the option to be a paid intern and gain college credit for their time with the company. This is up to the discretion of the employer. However, each intern must be treated in accordance with New York State Labor Laws.
Independent Contractors
Independent contractors are a unique type of worker. According to the New York State Department of Labor, independent contractors “are in business for themselves and make their services available to the public.” In short, independent contractors are not employees of the business or firm. They are hired by the business or firm to perform certain tasks and are paid for the services that they provide. With this, according to the New York State Department of Labor, “independent contractors perform services free from supervision, direction, and control.”
There isn’t a statute in New York State that defines an independent contractor. According to the New York State Department of Labor, in order to determine if an individual is an independent contractor or an employee of the company, the State must “determine if the party who has the contract for the services provides, or has the right to provide, supervision, direction and control over the person who performs the services.”
An employer is generally required to withhold taxes from the paychecks of employees, but is not required to do so for independent contractors. As a result, both the New York State Tax Department and the Internal Revenue Service (IRS) are often interested in the status of a worker as an employee or independent contractor. Both departments have their own set of criteria to determine a worker’s status and there is no one criteria that is determinative. Contrary to popular belief, it is not merely up to the employer to categorize workers as they choose.
Finding the right workers for your type of business can take time. Understanding the laws associated with each type of worker can also take time, but is essential for the smooth and continuous operation of your business. Ambiguities of each type of worker may lead to confusion. It is best to consult an employment law attorney prior to hiring workers for your business if you are unsure of the legal ramifications. The New York business lawyers at Blodnick, Fazio & Clark are experienced legal professionals who can assist you in determining the right employees for your business. The attorneys at Blodnick, Fazio & Clark will guide you through the employment process and help you find your path to success. For more information or to schedule a consultation, contact our Long Island business lawyers at (516) 280-7105 or (631) 669-6300.
