Contractor vs Employee: Why Misclassification Is Still a Major Risk

Written By Jennifer Jennifer

Many small businesses use contractors for flexibility — but misclassification remains one of the biggest compliance risks.

Common Misclassification Triggers

  • Set schedules

  • Company-provided tools

  • Ongoing work without defined end dates

Why It Matters

Misclassification can lead to:

  • Back taxes

  • Penalties

  • Wage claims

  • Audit exposure

Correct classification protects both the business and the worker.

Jennifer Jennifer
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