Is dependent the opposite of independent? Not in the law. The opposite of independent is actually “employee.”
There has been a proliferation of litigation regarding whether persons who are treated as independent contractors have actually been misclassified and should have been treated as employees. The issue brings substantial exposure to employers because the law provides very significant remedies and the cost of defending legal and administrative actions over this issue can be very high.
State and Federal agencies have published criteria for determining whether a person is required to be treated as an employee or may be treated as an independent contractor. The onus is almost always on the employer to establish that a person is not an employee. These laws cannot be waived, even where the worker agrees in writing to the independent contractor treatment.
The significance of misclassification includes potential violation of overtime and minimum wage laws, payroll tax withholding requirements, unemployment insurance and workers comp insurance violations, COBRA violations, and many more. An employer is well advised to consider the ramifications of a misclassification lawsuit before entering into a dubious independent contractor relationship.