Independent contractors in Texas, Oklahoma and New Mexico
A major issue for the labor community is the classification of independent contractors. Employers classify workers as independent contractors to avoid paying additional taxes, workers’ compensation and other costs associated with hiring employees.
The consequences of independent contracting
Independent contracting is dangerous for workers, as it affects their eligibility for benefits and lowers the wages they are paid. This practice is often used in the trades when a company needs temporary labor in order to complete a job.
Employers classify workers as independent contractors in order to pay less taxes. When a worker is classified as an independent contractor, an employer still gives them a paycheck, but does not withhold various taxes for benefits. Independent contractor classification also allows employers to avoid Social Security and Medicare. Additionally, they do not have to provide any benefits, such as healthcare or retirement benefits.
Independent contracting is physically dangerous for other workers and could cause harm. Since the purpose for wrongly classifying workers as independent contractors is to avoid the costs associated with hiring someone as an employee, training may be skipped. Training in the pipe trades is vital, as one wrong decision could shut down a whole project due to injury or death.
Benefits of collective bargaining
Compared to being classified as and working as an independent contractor, employees working under collective bargaining agreements tend to fare much better. Collective bargaining provides employees with an agreed upon wage between labor and management. Additionally, collective bargaining yields benefits to be enjoyed by family members and into retirement.
Healthcare in the U.S. is one of the largest expenses a family may have to budget for if it is not covered by their employer. Under a collective bargaining agreement, benefits such as family health insurance are agreed upon, allowing Americans to avoid one more expense.
Collective bargaining is also great for local communities. By working under a collective bargaining agreement, a local workforce is used. This workforce is more likely to spend money in the community they are working in, since they live in that community or nearby.