|
Liability When Hiring Third Parties
| Is the hiring party liable for contracts or torts by the hired
party? |
Agents (hired to represent a principal) |
Employees (hired to work under an employer's control) |
Independent
Contractors (hired to perform a
task; not directly controlled by the hiring party) |
|
Contracts |
Yes, if actual authority, apparent authority, or
ratification |
No, unless ratification |
No, unless ratification |
|
Torts |
Yes, if tort committed within the scope of the relationship
(the doctrine of respondeat superior) |
Yes, if tort committed within the scope of the relationship
(the doctrine of respondeat superior) |
No (generally), unless employer authorizes unsafe practice |
|
Employer Costs, Responsibilities, and/or Liability
Exposure
|
Is the Employer Responsible?
|
|
|
For Employees or Agents
|
For Independent Contractors
|
|
FICA/FUTA/FLSA/ERISA
|
Yes
|
No
|
|
Withholding Taxes
|
Yes
|
No
|
|
Federal Civil Rights Laws
|
Yes
|
Probably no, but varies by court
|
|
State Civil Rights Laws
|
Yes
|
Yes or no, depending on state
|
|
Tort Liability
|
Yes
|
Usually, no
|
|
Worker’s Compensation
|
Yes
|
Usually, no
|
|
Liability for job completion
|
No
|
Yes
|
|