A Washington, DC independent contractor agreement legally defines a business relationship between a client and a contractor. Below, learn the DC laws on hiring independent contractors and download a free template to outline the terms and conditions.
- Worker Classification: Common Law Test
- Tax Structure: Graduated-Rate Income Tax
- Definition: No statutory definition; see case law – Munson v. District of Columbia Dep’t of Emp’t Servs., 721 A.2d 623, 627 (DC 1998)
- At-Will Employment: Yes (with exceptions)
Independent Contractor Definition
According to the Code of the District of Columbia Section 32-531.01, individuals hired by an employer are employees unless they:
- Volunteer for an educational, nonprofit, religious, or charitable organization.
- Are a lay member appointed or elected to office within any religious organization.
- Are a casual babysitter.
- Are a student.
- Are an independent contractor.
- Are a substitute aide or teacher employed by the District of Columbia Public Schools for 30 or fewer consecutive workdays.
Worker Classification Test
You can receive expensive fines if you don’t follow DC’s employee classification law. Here’s a summary of the most important employment laws.
Washington, DC uses a “relative nature of the work” worker classification test [1] , which looks at the following factors:
- How the employer selects and engages the worker.
- How the employer pays wages.
- How much power the employer has over the worker.
- Whether the services performed by the worker are part of the regular business of the employer.
Rights and Responsibilities
Unlike employees, independent contractors do not have any special rights in the District of Columbia. But there are some responsibilities contractors should be aware of.
State Taxes
DC uses the same classification test as the Internal Revenue Service (IRS) for tax matters. This means that anyone who performs services for you is your employee if you have control over what they do and how they will perform the service.
Independent contractors are free from employer or client control. As such, you should use Form 1099-NEC to report payments for independent contractor services.
Filing for Unemployment
No, independent contractors do not file for unemployment in DC [2] . As an employer, you only have to pay unemployment taxes for employee wages.
When determining who is an employee and who is an independent contractor for the purposes of unemployment taxes, the District of Columbia’s Department of Employment Services will consider the following:
- Who has the right to determine how the work should be done.
- The method of compensation.
- Whether the individual providing services is engaged in an independent occupation, trade, business, or profession.
Compensation for Work Injuries
According to the District of Columbia Code Section 32-1501(9), DC uses a two-part right-to-work test for workers’ compensation. This test focuses on whether the worker is hired to do work in which the employer specializes.
The court will first examine the character and nature of the worker’s business or work by looking at the degree of skill involved, the degree to which it is a separate business, and its ability to shoulder accident burden. It will then examine the relationship between the worker’s services and the alleged employer’s business.
Sample
Below, you can download a free Washington, DC independent contractor agreement template in PDF or Word format:
