FreelanXAt a glance
Check the signals, not the label.
Fixed hours
Set by the company, not by the contractor.
Company tools
Equipment, email and internal systems.
One client
The company is the only or main client.
The term
What it is, and how to avoid it.
The signals to check, what misclassification can cost and the options that remove the risk.
On this page
General information, not legal advice.
In one sentence
Misclassification happens when a person is engaged as an independent contractor but works, in reality, like an employee. Authorities look at how the work is done, whatever the contract is called.
The signals to check
The company sets the hours and the place of work
The person uses the company’s equipment, email and tools
A manager directs the work day to day
The company is the only or main client, for a long time
The person is paid by the month, whatever is delivered
The person cannot turn work down or send someone else
The more of these apply, the higher the risk. One alone is rarely decisive.
What it can cost
When a contractor is reclassified as an employee, the company can owe back social contributions and taxes, penalties and interest, and the rights the person should have had, such as paid leave or protection against dismissal. Amounts and rules depend on the country.
How to avoid it
Change the set-upDefined deliverables and milestones, the contractor’s own tools and schedule
Contractor of record$279 per contractor per month: FreelanX EOR engages the contractor and carries the compliance, with protection against misclassification
Employ the personThrough FreelanX EOR, from $499 per employee per month billed yearly
FAQ · Misclassification
Questions people ask first.
Does one signal mean misclassification?
Does the contract title protect me?
How does FreelanX help?