Massachusetts laws
MGL c.149, § 24L Massachusetts Noncompetition Agreement Act
Independent contractors are employees for the purposes of this section.
MGL c.149, § 148B Classification standard for independent contractors in Mass.
Includes the 3 prong test:
- the individual is free from control and direction in connection with the performance of the service, both under his contract for the performance of service and in fact; and
- the service is performed outside the usual course of the business of the employer; and,
- the individual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed.
Federal laws
Internal Revenue Service Revenue Ruling 87-41 Establishes the federal "twenty point test"
Selected cases
Camargo's Case, 479 Mass. 492 (2018)
The definition of "employee" is different in the worker's compensation statute, MGL c.152, § 1, than in the independent contractor statute, MGL c.149, § 148B. When determining eligibility for worker's compensation, the definition in MGL c.152, § 1, and not the definition in MGL c.149, § 148B, is used.
Massachusetts Delivery Association v. Healey, 117 F.Supp.3d 86 (aff'd 821 F.3d 187) (2015) Affirmed by 821 F.3d 187 (2016)
The Federal Aviation Administration Authorization Act ("FAAAA") preempts the second prong of the Mass. Independent Contractor law, which requires that workers perform a service "outside the usual course of the business of the employer" to be classified as independent contractors." Therefore, workers who deliver papers may remain independent contractors.
Somers v. Converged Access, Inc., 454 Mass. 582 (2009)
The measure of damages is not "measured by subtracting the compensation the plaintiff obtained as an independent contractor from the compensation the plaintiff would have received had he been hired as an employee. We conclude that this measure of damages contravenes both the plain meaning and the primary purpose of the independent contractor statute and the wage act. An employee misclassified as an independent contractor, as a matter of law, is an employee; his contract rate is his wage rate; and his "damages incurred" equal the value of wages and benefits he should have received as an employee, but did not."
Schwann et al. vs. Fedex Ground Package System, US Dist. Ct. Mass. (2017) and Remington et al vs. J.B. Hunt, Inc. US Dist. Ct. Mass. (2016)
Discussion of preemption of the first and third prongs of the Mass. independent contractor statute by the FAAAA.
Web sources
Advisory on the Massachusetts Independent Contractor Law, Mass. Attorney General Advisory 2008/1.
Covers history of the law, the 3-prong test, what constitutes violation of the law, and enforcement guidelines.
Effect of new employee classification requirements under G.L. c. 149, § 148B on withholding of tax on wages under G.L. c. 62B, TIR 05-11, Mass. Dept. of Revenue.
"This TIR summarizes the differences in the general rules for determining employee/independent contractor status under chapters 149 and 62B. Second, this TIR announces that the Commissioner will accept determinations of employee or independent contractor status, as described in this TIR, by the Internal Revenue Service for purposes of identifying income tax withholding obligations under chapter 62B."
Gig economy tax center, IRS.
"If you use one of the many online platforms available to rent a spare bedroom, provide car rides, or to connect and provide a number of other goods or services, you’re involved in what is sometimes called the sharing economy....If you receive income from a sharing economy activity, it’s generally taxable even if you don’t receive a...statement."
Independent contractors, Mass. Attorney General.
Find out who can be classified as an independent contractor with links to file a complaint (look in the contact information for the complaint.)
Minimum requirements for working as an independent contractor, Stephen Fishman, Nolo.
Independent contractors and freelancers must comply with several laws. Not specific to Massachusetts.
Misclassification of employees as independent contractors, U.S. Dept. of Labor
The department outlines factors to consider when classifying workers. It includes a link to a proposed rule change of the department’s guidance to determine who is an employee and who is an independent contractor.
Self-employment tax (Social Security and Medicare Taxes), IRS.
Self-employment tax is a tax consisting of Social Security and Medicare taxes. Explains how they should be estimated and paid and is different from income tax.
Print sources
Consultant & independent contractor agreements by Stephen Fishman, Nolo, 2020. (eBook available here with library card)
Employment status: Employee v. independent contractor, Tax Management, loose-leaf.
Independent contractor v. employee, MCLE, 2011.
Massachusetts wage and hours handbook, 7th edition, MCLE, 2022. Chapter 3, the Massachusetts Independent Contractor law.
Working for yourself: law & taxes for independent contractors, freelancers & gig workers of all types by Stephen Fishman, Nolo, 2022. (eBook available here with library card)
Working with independent contractors by Stephen Fishman, Nolo, 2020. (eBook available here with library card)
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| Last updated: | May 22, 2023 |
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