Independent contractors in Texas

When a worker is misclassified, they lose key benefits and are forced to pay additional taxes an employee would not have to pay. Additionally, misclassification means a company does not have to workers’ compensation and other costs associated with hiring employees.

A worker who is considered an independent contractor is not be eligible to receive benefits provided by an employer and often leads to lowers their wages. 

Employers who classify workers as independent contractors pay fewer taxes. When a worker is classified as an independent contractor, the employer will give them a paycheck, will not withhold various taxes, such as Social Security and Medicare, plus other applicable taxes.

Employees who do not know they are misclassified as independent contractors are on the hook for all of these taxes, which can be costly if detected by the Internal Revenue Service or the state department of taxation. 

Furthermore, the cost of working as an independent contractor could lead to potential physical harm for the worker or others on the jobsite. An independent contractor will likely not have the same level of training as a union construction worker. Safety training is crucial in the construction industry, especially in the pipe trades, as one wrong decision could shut down an entire project due to injury or death.

Benefits of a Collective Bargaining Agreement

Employees covered under a Collective Bargaining often fair better than independent contractors. CBAs not only provide employees with an agreed-upon wages and benefit levels, but they ensure an employee is not misclassified. These agreements allow employees earn a liveable wage, recieve good benefits and not worry about the ramifications of being labeled an independent contractor.

In the U.S., healthcare could be one of the most significant expenses for which a family may have to budget if it is not covered by their employer. Often times under a CBA, health insurance is one of the negotiated items, ensuring a family has some level of health protection. While the deductables may differ, the insurance is there if needed. Those who are missclassified as independent contractgors must pay for their own medical insurance. 

Collective bargaining agreements also benefit local communities. When a workforce operates under a CBA, they are usually earning a livable wage, which provides them with money to spend in the community where they work and live.