Distinguishing an independent contractor from an employee matters to a small business owner; business owners need to (for example) pay unemployment insurance and withhold taxes from employees, but do not need to do so for independent contractors. "Work for hire" agreements help a business owner ensure that any intellectual property that an independent contractor they employ creates belongs to the business, not the contractor. However, under these agreements, the contractor is still, for other purposes, an independent contractor, not an employee, in the eyes of the law.
Arina Shulga notes that California does not follow the crowd in this matter, though; California considers individuals under "work for hire" agreements employees. In this blog post, she explores the contours of California's law which makes this so.
- Summary by FizzLaw Team
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Independent Contractors or Employees: California’s “Work For Hire” Contracts