Contingent Worker Definition


According to the U.S. Department of Labor, contingent workers are independent contractors in a global freelance marketplace.

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It is important for a business and its human resources department to correctly classify the contingent worker, even if the worker is not full time. According to guidelines by the Department of Labor, an independent contractor is different than a temporary employee. While the business does not have to offer benefits to a temporary worker, they do have to follow other employment laws that pertain to permanent employees, such as overtime pay and minimum wage.

On the other hand, an independent contractor can be paid with one lump sum at the end of the project or in equal payments and would not receive overtime pay. A business can’t be held to the same requirements as they are for full-time employees because the independent contractor is legally self-employed. The difference in the two distinctions lies in how the worker is treated. A temporary employee may have set hours and duties and answer to a supervisor, working in a similar fashion to an employee. Whereas an independent contractor may set his/her own hours and may not have a direct supervisor overseeing their work.

An individual can often achieve a better work-life balance as a contingent worker. Many positions pay well and allow for remote work and flexible hours. Additionally, because the nature of the work is temporary, the person can move from job to job without having a negative impact on their resume. It can also give someone the opportunity to work in a variety of industries and gain valuable skills that can turn into a permanent position in the future.

More info: Hire a Contingent Employee

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