Updated June 26, 2020:

I am an Independent Contractor Not Getting Paid

Are you thinking, “I’m an independent contractor not getting paid what I’m worth?” Many contractors think that on occasion. What you need to remember is that as an independent contractor, you can set your own rates, choose your own jobs, and make your own decisions. If you are not getting paid what you think you are worth, or if you are not getting paid per your contract with your client, there are some steps you can take to remedy both situations.

What Does Independent Contractor Mean?

When you’re an independent contractor, you have more freedom as to how you want to do your work. However, you are held responsible for getting your own health insurance, paying your taxes, and paying into unemployment.

The terms for your work will be based on a contract or other agreement. The terms can be a formal contract or a verbal agreement. You will also generally work in your own office or in a place other than in the client’s business. Independent contractors also provide their own supplies for completing a job if it is necessary.

Difference Between an Employee and Contract Worker

Employees and independent contractor are two very different forms of working situations. There is much more difference than just the title. If you are a contractor, you are not entitled to receive the same rights as an employee under the law. For instance, you will not have any discrimination rights like an employee will.

Employees are also guaranteed certain wages, including minimum wage and overtime payments. Independent contractors are not entitled to any specific wages, just those that you contracted for in your agreement with the client. The client also does not have to provide you with any type of insurance or other benefits. Employers are required to deduct payroll taxes for employees, but not for contractors.

On-demand workers are a new category of contractor that are employees that do work for an online or app-based company. An example would be a person who drives for Lyft or Uber. In this working situation, the employers have been criticized for how on-demand workers are treated.

The issue is that the on-demand worker is not an employee and employers will use this logic to defend themselves. The critics of on-demand workers say that companies utilizing them are performing a labor-brokering function. Therefore, there is currently legislation being developed to cement the rights of these workers.

In true fashion, an independent contractor works for him or herself. The independent contractor has many benefits including:

  • The ability to take on as much or as little work as he or she would like
  • Working for many clients at any given time
  • Setting his or her own rates
  • Deciding how the work is done
  • Choosing where the work will be completed
  • Choosing when to work

On the flip side, an employee is allowed to work for one or two employers at a time. The employee has to work at the place of business, follow rules set by the employer, follow a set schedule, and is paid a salary offered by the employer, working on tasks assigned by the employer.

Non-Payment of Contract Workers

If you’re a contract worker and you do not have a contract, you could face problems getting paid for your work. If you aren’t paid for your work, you need to submit a letter to the business that details the work you completed and the payment that you expect to be paid.

If you have been paid by this client in the past, it helps establish the fact that you had a form of contract. You need to document any payments made to you previously and gather all tax documents provided by the client. This includes your 1099-MISC tax forms that show you were paid prior.

Once you have presented this evidence to your client and you still have not received payment for your work, you need to consult with an employment law attorney so that you can get the law applied to your own circumstances.

If you need help with getting paid as an independent contractor, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law, and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.