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The Difference Between Agents and Independent Contractors: Know the Significance

Agents vs. Independent Contractors

Firstly, as a business owner, there are many tasks you will delegate. It is impossible to for you to expect that you can handle every aspect of your business by yourself. You are probably going to need hire others to do work for you, and in fact, courts encourage it. That being said, who you hire to do work for you has great implications beyond simple efficiency. There are two categories of people you will hire as a business owner: independent contractors and agents. For you, it may simply be a matter of delegation. However, for courts and from a legal perspective, there are other implications involved.

Employees you hire that work under your command will fall into the category of agents. Hired help for either temporary or recurring tasks may fall into the category of independent contractors. In essence, a court will look to the amount of control you exert over the person you have hired to make their decision. For example, if you outsource some work to another company or an individual that specializes in that line of work or task, that hired individual will most likely be considered an independent contractor. Especially if you leave a great amount of discretion up to that individual. If you hire somebody on a recurring basis or have them working under your control with less discretion, courts will most likely believe those individuals are agents.

How does this affect my business?

Ultimately, the significance in whether or not somebody you hired is an independent contractor or an agent cannot be understated. It could mean the difference between being liable for the action of the person you hired. If you hired an agent, a court is much more likely to find you liable for his or her actions. Courts view agents as an extension of you. If the work were not delegated, you would have yourself committed the wrong. Meanwhile, if the individual is considered an independent contractor, you will be found not liable. Courts understand that independent contractors are known to have a wide amount of discretion whereby they make decisions that are outside the control or knowledge of the employer. It would be unjust to hold an unknowledgeable employer liable for an individual’s actions when they could have no knowledge of what they may do during the course of completing a particular task.

What should I do next?

As a business owner, you should pay great attention and weigh the benefits and detriments of hiring either independent contractors or agents. Alternatively, you may have already hired individuals to complete work on your behalf, and may be concerned of the level of liability you have exposed yourself to in the process. Having the insights and knowledge of an experienced legal team can make the difference. Give Trembly Law Firm a call at (305) 431-5678 today to schedule a consultation.

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