If you're in California, you have probably heard that Uber and Lyft don't want to be in California because the state is saying that they are employees, not "self-contracted," or whatever the term is. They say that "contractors" are only for people working outside the business, like a roof installer on a real-estate office, I presume.
It seems that this would also include subs. I am an employee, but from what I've heard on here, many of you are deemed "self-employed."
Not sure what difference it would make, but they claim that Uber drivers should be getting insurance, etc.
In CA, I believe that a district has to offer you benefits if you work a certain number of days. Note that is offer, not pay. Remember that many school employees pay for a portion of their health benefits.
Many years ago a small group of subs, I included, formed a union.
We took 4 years meeting weekly,trying to work with the district who of course rejected the idea, but played along in good faith. It was only until we threatened to strike at Thanksgiving, that they raised our wages and accepted our unionization. I am telling this back story, because at the time the superintendent said that we were contractors. You cannot be a contractor if you receive a W-2.That ended their assertions.
I think there is a lot of underlying information and tax law that news stories tend to skip over. Then state tax laws may differ as well. I know one criteria to classify a person as a contractor or employee, is does this person have to follow the company's direction about how and maybe when the work is done.
I have my own quilting business, and my clients and I agree on what service I will provide, but then they leave and I complete the job using the materials and the manner that I see fit. I work at any time of the day or night that I feel like it. I am a contractor, not their employee.
In an average job, let's say you work at Mc Donalds, they tell you when to come in, what to wear, and this is how you make a Big Mac, and don't forget to ask if they want fries with that. Clearly an employer/ employee relationship.
lyft and Uber sure seem like independent contractors to me. Substitute teaching, less so. Except subs get no benefits whatsoever, like even Mc Donalds employees earn paid time off....
Yes, once you receive the w2, the decision has been made. But someone has to decide first, are you an employee? If so, the employer will Withhold taxes, FICA and medicare tax, and also pay payroll taxes on each employee, including FICA and unemployment. Then this employer will issue the W2 at the end of the year. (interesting that school districts have been paying Unemployment on us subs, but most of us have had huge problems trying to claim unemployment all this time...)
If you are a contractor who does a certain amount of work for a given business, that business has to give you a 1099 and file that 1099 with the IRS.
If you are a contractor, you may have several businesses that issue you 1099s, or in my case, no one issues me a 1099 because I do only a small amount of business with any one customer for a given year. I have to account for my income myself. Contractors are self employed and therefore will file a Federal Schedule C whether or not they end up receiving any 1099s.
Businesses are better off in some respects if you/they decide you are a contractor (self employed) rather than their employee. They will not have to pay any payroll taxes on you. That situation is what the CA law is supposed to fix, but all it is doing for these "freelancers" is putting them out of a job. I believe Uber and Lyft are only two of the groups impacted by this.
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08-20-2020, 12:46 PM
