Hiring Workers as Independent Contractors

[construction1688]

My question involves independent contractors in the state of: CA

Can I hire an unlicensed independent contractor to work for me on short term project at the job site/ in the field(eg 3 months) if I am licensed contractor? If yes, what type of form/contact should I have so the independent contractor will know that his employment will end in 3 months?

Is there a difference between independent contractor vs subcontractor?

Also who need to sign Indeminification, Hold Harmless Agreement?

Thanks,

New contractor just got his license

[eerelations]

You are the independent contractor in this scenario.

Anyone you hire to work directly for you on a jobsite, whether they're licensed or not, is legally an employee of yours, not an independent contractor. You must pay this person via payroll, deducting all applicable withholdings.

"Independent Contractor" and "Subcontractor" are two entirely different entities.

You are the one who signs an indemnification agreement with your client. Your employees (what you've been mistakenly thinking of as "subcontractors") don't have anything to do with this.

[racerealestate]

It is better to go for an licensed contracter.

[SChinFChin]

My question involves independent contractors in the state of: CA

Can I hire an unlicensed independent contractor to work for me on short term project at the job site/ in the field(eg 3 months) if I am licensed contractor? If yes, what type of form/contact should I have so the independent contractor will know that his employment will end in 3 months?

Is there a difference between independent contractor vs subcontractor?

to sign Indeminification, Hold Harmless Agreement?

Thanks,

New contractor just got his license

I got a guy working for me as a 1099 subcontractor. He was seriously injured, the ambulance took him directly to the hospital.

I didn't have a hold harmless on file, but he was more than willing to give me one, backdated if needed. A few days after he was admitted though, the hospital called me up, and asked for the name of the "workman's comp" insurer, and the claim number. But because he is a subcontractor, my WC insurance does not cover him.

I stalled for time, told the hospital I was not sure if I had him down for my WC coverage, and if not, we are sure we have a hold harmless agreement, so in the meantime, I can check with my lawyer. The hospital told me the hold harmless agreement has nothing to do with them, it's between us and the subcontractor, which means he can't sue me, but the hospital still can sue me. The hospital went on to say since he said he was doing work for us when the accident happened, they would be sending me the bill if I don't have a WC claim number.

The hospital bill finally came to over $25,000 as I found out later. Not thanks to my lawyer who had no idea what to do, I finally put him down as an employee, paid taxes on it that I didn't deduct, and filed a WC claim as an employee. The taxes came to less than a $1,000.

A subcontractor normally works for another contractor if you hired the "contractor" first. Independent normally means he works for himself, which means one day you get out of bed, you decide to mow lawns, find a customer yourself, you are now an independent contractor. But if a lawnmoving service does someone's lawn, is short of help, hires you to fill in, then you are the subcontractor, and you can at the same time be independent.

You can also be an idependent doing work at a company, and if they don't have you down as an employee, then you are referred to as a 1099 subcontractor. However, you would not get unemployment or workman's comp.

Remember, hold harmless and indemification is only between you and him. If something happens, third parties can always sue. Of course, with an indemnification agreement, I can tell my 1099 subcontractor to indemify me for $25,000, but he would have to have the $25,000 in the bank first. And if I ever have to get after him to collect, he can always sue me back saying he had no idea what a 1099 subcontractor is, and what a W2 is, and if he testified to that, he would be totally correct, as he is an illiterate immigrant, and technically I should have had the agreement in Spanish as well explained to him by an attorney before he signed. So I'll be in a heap of trouble enforcing the indemifiation.

The best thing is to use an employee or an insured contractor. I'm in the rental business as a LL, and I ask new contractors for their "certificate of insurance" to be sure they are an "insured" contractor as they claim in their advertising and on their trucks, and you'll be surprised how many claim to be insured, and yet is not.