Paul L. Salafia On NH Statutory Changes Re Employees v. Independent Contractor

Paul L. Salafia On NH Statutory Changes Re Employees v. Independent Contractor

The New Hampshire Legislature has recently adopted statutory changes that will govern whether an employee is in fact an employee, or an independent contractor, for the purposes of workers’ compensation benefits.  The new criteria will also be determinative in issues regarding employment, payment of wages, whistle blower protection, and minimum wage issues.  This commentary, written by Paul L. Salafia, a shareholder of Divine Millimet, examines the impact of the present legislative changes and provides a brief review of the historical underpinnings of the “employee versus independent contractor” issue in the State of New Hampshire. Mr. Salafia points out that, in the span of approximately one decade, the state legislature has moved from a totality of circumstances test involving an evidentiary weighing, to a rebuttable presumption test.  The most recent change requires eleven factors to be proven by the defendant, rather than merely five, in order to classify a workers as an independent contractor.  The New Hampshire Department of Labor has testified before the Legislature as being in favor of both statutory changes.  The practical effect of the most recent statutory change would appear to be the result that almost any person receiving services for pay will be found to be an employee by the New Hampshire Department of Labor.  It would appear that the most recent statutory change is in response to a belief on the part of the New Hampshire Department of Labor that employers incorrectly classify employees as independent contractors in order to avoid paying workers’ compensation premiums for those workers.

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