M.G.L. c.149, section 148B sets the standard for how independent contractors are classified in Massachusetts. Under this Massachusetts law, a three-part test has been established to help business owners and managers determine whether someone they hire to perform a job is an employee or an independent contractor.
Below you will find a list that can be helpful in determining whether a Massachusetts court will view the next person you hire as an employee or an independent contractor.
- Is the person that you’ve hired free from your control and direction while performing the service for which you have hired them?; and
- Is the service that is being performed not the type of service that your business performs?; and
- Does the person that you’ve hired to perform this service, usually perform the service as part of an independently established trade, occupation, profession or business that does that type of work?
If you can answer “yes” to all three of these questions, then the person that you’ve hired may be viewed by a Massachusetts court as an independent contractor.
Why it Matters – Independent Contractor vs. Employee
It is very common, in my experience, to hear a business owner or manager say the following…”I’ve only hired this person to do this one job, I’m not worried about any liability.” It is all too common in the business world for managers and business owners to hire someone to complete work for the business without considering what might happen should something go wrong.
When Your Contractor is Your Employee
Thinking that you’ve hired an independent contractor when you’ve really hired an employee is probably the worst case scenario for an employer. Let’s say you hire a painter, by way of example, to paint the inside walls of your office. The job takes her three weeks to complete, and she does a fantastic job of it. Shortly thereafter, one of your office employees begins complaining of throbbing headaches and stomach pain. She takes a week off from work to find out what is wrong, the next Monday morning when she would typically appear for work, the office employee informs you that she is having some allergic reaction to the paint fumes, can’t sleep at night and has been sick ever since the office was painted by the painter.
At first blush, if you are the manager or owner that I described in the previous example, you might think to yourself that there is nothing to worry about because the painter is an independent contractor. You might also think that there was no way that you could possibly anticipate that your office staff member would have any allergic reaction to the fumes of the paint, and moreover, that the painter was an independent contractor, and so your company has no liability concerns. Of course, you wish your employee the best, and you decide you will also offer to pay for your staff members medical bills so that she can overcome her present difficulties.
Three months pass, and your employee is still not feeling well, and has been missing many days of work. You are surprised when the office manager informs you that a complaint was served to her this morning which alleges that your employee has caused injury to your office worker. The employee named in the complaint is the painter. You think to yourself, “how can this be? I only hired the painter for one job, it would be unfair to hold my business accountable for her actions.”
What you did not anticipate is that the painter may, in fact, be considered (for the purpose of applying liability) your employee. Consider this argument, that your employees attorney may make to explain that the painter is your employee not an independent contractor:
1. The painter was given specific direction from your general manager who informed her which offices to paint, how to paint each room. Your business manager told the painter to use long strokes when painting, and to “move it along because we have an important meeting in two weeks.”
2. The painter was a friend of the general manager’s family. She had never painted an office before, only a few fences over the previous summer. She is an out-of-work accountant who was just trying to make ends meet.
While it may be stretch, her attorney could argue that your company is liable for the actions of the painter because she failed the three-part test of M.G.L. c.149, section 148B. She is your employee not an independent contractor, her attorney will argue, because she was under your control and direction while painting the office and that she was performing a service in a trade that she is not customarily engaged in. A court could, for the purpose of attaching liability, find that your business employed the painter directly as an employee and is therefore liable for the actions of the employee. If you have insurance coverage you might be covered, but your premium rates will rise. You may have to fight your own insurance company if they find that your business was negligent in “hiring this employee.”
Avoiding the Independent Contractor / Employee Dilemma
Whenever you hire someone to perform a service for your business in Massachusetts, make sure that you vet the prospective worker or company before they begin the work. You want to establish early in the relationship that the following:
(a) the worker is working independently, that you exercise only minimal control (such as, the color or time frame of the work to be done), but that the worker controls the detail of the work performed.
(b) ensure that you are not in the same business as the person you are employing, and
(c) ensure that the person you are employing typically performs the type of service that you have hired him or her for, and that that service is that of an independently established trade, occupation, profession, or other business which provides the same type of service
A Little Prevention…
Conducting a simply vetting process and training your employees working for your Massachusetts business to do the same can mean the difference between assuming liability for the actions of an employee or having a Massachusetts court view that worker as an independent contractor and thus liable for their own actions.
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The information provided in the pages and posts of this website are for general informational purposes only. The information presented on this site is not legal advice, and no attorney-client relationship is formed by the use of this site.
