A Connecticut independent contractor agreement is a legally binding document that defines the terms and conditions between a business and an independent contractor. It outlines the scope of work, payment terms, responsibilities, and other crucial details to protect the rights of both parties involved.
- Worker Classification: ABC Test
- Tax Structure: Graduated-Rate Income Tax
- Definition: § 31-222(B)
- At-Will Employment: Yes (with exceptions)
Independent Contractor Definition
Connecticut’s definitions of employees and independent contractors dovetail with each other:
Independent contractors: Those who can satisfy all three prongs of the ABC Test outlined below.
Employees: All workers except those who can satisfy Prongs A, B, and C of the ABC Test.
Worker Classification Test
Understanding Connecticut’s laws surrounding independent contractors can help ensure that Connecticut correctly classifies a worker according to state law.
In Connecticut, independent contractors are classified based on the following attributes:
- They use their own chosen work methods.
- They often charge a flat fee.
- They usually advertise their services.
- They often maintain a viable location for their business.
However, there is a legal test for determining the legal classification of your worker called the ABC Test. Connecticut uses all three prongs of the ABC Test to determine whether your worker is an employee or an independent contractor [1] .
If you can prove your worker meets all three prongs of the ABC Test, Connecticut will consider them an independent contractor.
Prong A considers whether your worker is free from your control* in performing their services. This freedom should be clear in three ways:
- Their performance contract
- In fact
- That the worker is usually engaged in similar independent work
* This excludes control that the state or federal government legally requires.
Prong B considers whether you can prove that the worker performs services outside your usual course of business.
Prong C considers whether you can prove that your worker is typically engaged in independent work and that they control the performance of their services. You may verify this point by providing evidence supporting Prong A and a written document, such as a Connecticut independent contractor agreement.
Prong B is complicated for some companies to satisfy. For example, if your company traditionally provides marketing services, then you would not be allowed to hire independent contractors in the marketing sector in Connecticut.
Rights and Responsibilities
One of the appeals of hiring gig workers is their general lack of rights compared to employees. The law considers your independent contractor an employee until you can prove otherwise.
Independent contractors in Connecticut generally do not have the following rights:
- Unemployment benefits
- Minimum wage requirements
- Overtime
- Workers’ compensation
State Taxes
Connecticut follows the IRS standard for classification. Independent contractors must pay self-employment taxes of 15.3% on earnings of $400 or more.
Filing for Unemployment
Connecticut uses the ABC Test to determine unemployment benefits. If your worker satisfies all three prongs, they will not be eligible for unemployment benefits in Connecticut.
Sample
Below, you can download a Connecticut independent contractor agreement in PDF and Word format:
