Colorado Independent Contractors laws & HR compliance analysis

Colorado Independent Contractors: What you need to know

Whether a worker is an “employee” or an “independent contractor” is critical when it comes to such important issues as pension eligibility, workers' compensation coverage, wage and hour law, and many other matters. In some situations, federal law will govern, but the question is most often resolved by looking to state law, particularly in areas such as unemployment tax liability, workers' compensation, and state wage and hour requirements.
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Under Colorado law, an individual is presumed to be an employee unless and until it is shown that the individual is free from control and direction in the performance of services, both under contract and in fact, and that the individual is customarily engaged in an independent trade, occupation, profession, or business related to the work performed. This means that the worker will be presumed to be an employee until the employer meets its burden to establish otherwise. This burden may be shifted to the Division of Labor Standards and Statistics (DLSS), however, through the use of a written document or contract. If the contract meets all of the requirements of the law, the worker would be presumed to be an independent contractor, and it would be the worker's burden to establish otherwise. This does not mean the worker would ultimately be determined to be an independent contractor, only that the burden of proof would be shifted.
In addition to including the above factors, the contract must contain a disclosure, in type that is larger than the other provisions in the document or in bold-faced type or underlined type, that the independent contractor is not entitled to unemployment insurance benefits unless unemployment ...

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