New Coronavirus Sick Leave Doesn’t Apply to “Independent Contractors” But There May Be a Small Benefit
by Kenneth Yoon
The Senate just passed the Families First Coronavirus Response Act.
This provides many employee rights once the President signs it, as he is expected to do. However, it doesn’t apply to independent contractors. So far, there seems to be little being considered politically that would help or protect workers classified as independent contractors.
That said, technically, if you are a true independent contractor, then you are a business-owner. You should be deducting all business expenses. But that also means you should be paying payroll taxes as the employee AND as the employer. This new bill, if passed without changes, appears to provide some tax credit for the employer’s share of payroll tax for sick leave.
So if you are an independent contractor and you pay yourself, you might want to consider paying yourself sick leave. Payments of sick leave may have a tax benefit where until now there has been none. After all, you’re just moving money from one pocket to another. Except in this case, temporarily, if you move money from one pocket to another, and you call it sick leave and it qualifies under this law as related to Coronavirus, then the federal government will give you some money.
If you are:
working for one company,
feel like an employee
but are considered an independent contractor where you don’t get a regular paycheck with taxes paid out, and
none of this post makes obvious sense to you.
Then you should talk to a lawyer and find out what your rights are. Rights to sick leave, overtime, breaks, etc.
We represent wage earners in class action lawsuits against employers for things like illegal tip policies. Please fill out our contact form or call us if you have any questions.
About the Author
Kenneth Yoon is the founder of Yoon Law, APC.