Why are people so dumb?

[eyesroll]

One of our longtime freelancers (who I stopped using about 18 months ago because she had too much going on in her personal life and got flaky -- but I started using her again a few months ago and so far it had gone swimmingly) is suing us for unemployment.

Her contract says this (as does everyone's):
Nature of Relationship. Author understands that he/she is an independent contractor, not an employee of (my company). As an independent contractor, Author is not entitled to employee benefits, such as sick leave, unemployment compensation, employer contributions, and income tax withholding.

What the hell is she trying to pull? She knows damn well she'll lose -- and now she's going to lose every last bit of my company's business, after her current contracts are fulfilled.
:grr:

[Magrittes Pipe]

1. If I were your employer...

...I would countersue for breach of contract.

[eyesroll]

4. The Bobs are on it

I just had to spend the last 20 minutes digging out each little bit of e-mail, contract, invoice, etc. that she and I have exchanged over the last 18 months.

[molly]

2. Did they payroll her on 1099 or did she in thru an agency?

you do have a contract - correct?

[eyesroll]

3. She's 1099

She even has the checklist that our accounting department sends all of our freelancers ("Do you offer your services to others?" "Do you bill on a per-job basis?" "Do you fill out, or intend to fill out, Schedule C on your 1040?" etc.)

And we do have lawyer-reviewed contracts.

She doesn't have a case -- I'm just pissed that she's trying to pull this.

[lapfog_1]

5. Well, she may have a case

the existence of a contract is not sufficient to establish that
she is not an employee, there are a number of other factors. (I was
a contractor for the federal gov for over 10 years).

First, did she have other contracts or places of employment?
Second, did you provide her with her primary location of employment?
Third, did you provide her with the tools and materials?
Fourth, Did you provide her with a SOW or did you direct her activities
on a day by day basis?
Fifth, was she paid personally or does she have a LLC or other corporate
identity?

Many small business owners get into trouble (especially on the
collection of payroll tax and FICA) by not being careful with the
laws regarding employee/employer relationships. I'd advise you
to retain legal representation and putting your records together.
The state (or IRS) may sue you for back taxes and there are
substantial penalties involved.

[eyesroll]

6. The lawyer combed this over...

As for your questions --
1. Yes. She lives in another state.
2. No.
3. A few sources to interview, since she's not familiar with the people in the industry, but otherwise no (and she was free to call others). Her phone, her computer, her Internet access, her library card.
4. I gave her a deadline. Other than the deadline, I had no control over when she did her work. She could do it at 4 a.m., in a 24-hour coffee shop, while high on crack, as long as it came in on time and done properly.
5. She was paid personally (1099); no taxes were withheld. She recently (last two weeks) established an LLC, as she was broadening from freelance writing to more generalized duties.

My magazine serves a contract industry, so I'm quite familiar with the IRS independent-contractor test (it comes up quite often in this industry -- contract janitorial). There's absolutely no way she could ever be considered an employee -- she's never worked at a company facility; she's never been paid in a method other than fee-for-project; she advertises her services to others; she works for others; she lives in a state where my company has no presence.

AND: I just assigned her something last week, before we found out she was suing us -- so it's not even like she's out of work with us.

Thankfully, I just work here, so other than the hassles, it doesn't affect my livelihood directly.

[lapfog_1]

7. You've got all the bases covered...

I don't understand the basis for her lawsuit.

Also, if you just renewed her contract for another job, I don't
understand WHY (which goes back to the subject for the thread
I guess).

Best of luck with this.

[eyesroll]

9. The renewal came a week before all this started...

So once that's over, we're done. (The lawyer advised us not to break the contract, since it's only $400 and breaking it might actually give her more ammo.)

[Magrittes Pipe]

8. If she is taking contracts from your company, WHILE suing your company...

...for unemployment -- the Bobs might want to talk to their lawyer about contacting the D.A.

This is fraud, plain and simple.