The debate on whether event staff should be classified as independent contractors or employees has been going on for years. While there are great arguments for both sides, the truth is that it falls in a gray area, meeting requirements for both. Many states have cracked down hard, with bigger agencies and companies like Uber losing cases for hiring staff as independent contractors and being required to hire them as employees.
This may seem like this is an issue that only affects event staffing agencies, but that’s wrong. Working with an agency that incorrectly classifies their brand ambassadors/event staff as independent contractors could lead to YOU as the client being deemed a co-employer. Here’s what that means:
- If you fail the Common Law test given by the IRS you are considered a co-employer
- If you exert a certain amount of control over event staffs’ job duties, hours worked, and/or overall management you are considered a co-employer
- As a co-employer you may be responsible for including event staff on your benefit plans and paying payroll taxes
- As a co-employer you may be responsible for paying back taxes, penalties, worker’s compensation and/or monetary equivalents of employment benefits for event staff
We aren’t attorneys so we can’t fully speak to the details and laws regarding this issue, but it is safe to say that utilizing event staff and brand ambassadors classified as independent contractors has become an increasingly large risk for companies. That’s why we’ve hired all event staff throughout the USA as employees since mid-2015. Whether you use an event staffing agency or hire staff direct for a 2-day trade show or year long mobile marketing tour, take care to understand the risks of how you or the agency is classifying the staff. A small cost savings now could cost thousands in the future (plus a big headache!).