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Freelancer: Employee or Independent Contractor?
Thread poster: Ursula Peter-Czichi

Ursula Peter-Czichi  Identity Verified
United States
Local time: 19:30
German to English
+ ...
Jun 18, 2003

An agency requests information. A huge monster in their data base demands to be fed. It lusts for information. Some I will readily throw out to feed the monster.

However, I am often vexed by this problem:
Some agencies convey the impression to me that I really apply for employment rather than offer my services as an independent contractor.

My question is:

How much information should I supply? Should it include such information as the Social Security Number (for US citizens) before the first project has even been distributed?

I do have to confess that some agencies have made me feel like a supplicant.

Your opinions and experiences would help me settle this conflict. Thank You!


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Narasimhan Raghavan  Identity Verified
Local time: 06:00
English to Tamil
+ ...
Tell them what you think of them Jun 19, 2003

We are not supplicants, period. Here in Delhi, India one agency asked me to sign an undertaking to the effect, that I will not take up knowingly or unknowingly work directly from their clients. In short I should get their approval before taking up any work from new clients, who approach me directly, in order to make sure that they are not their clients as well. I just told the agency that they need not give me any work and I am not ready to accept any such sweeping conditions. I did not sign any undertaking. Yet they gave me work and did not raise the question of the undertakings. With such agencies, you in turn can ask them to give their commercial registration number and the proof that they are not bankrupt. However, before taking up such extreme stances, you can politely tell them that they will be given details about your capabilities and nothing more before they entrust you with a concrete assignment. Here too give only the details that are strictly necessary for the commercial operations.



Ursula Peter-Czichi wrote:

An agency requests information. A huge monster in their data base demands to be fed. It lusts for information. Some I will readily throw out to feed the monster.

However, I am often vexed by this problem:
Some agencies convey the impression to me that I really apply for employment rather than offer my services as an independent contractor.

My question is:

How much information should I supply? Should it include such information as the Social Security Number (for US citizens) before the first project has even been distributed?

I do have to confess that some agencies have made me feel like a supplicant.

Your opinions and experiences would help me settle this conflict. Thank You!


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Joanne Parker  Identity Verified
Local time: 00:30
Member (2002)
German to English
+ ...
You're not an employee! Jun 19, 2003

(Please note before I start all this - I am not a lawyer!)

In the UK, Inland Revenue has several criteria that it uses to assess whether it believes a person to be self-employed or a "hidden" employee of a company. (I say "it believes" because contractors and companies are increasingly objecting to the IR's decisions about this and the tax implications that this involves.)

In my opinion, you are definitely an independent contractor assuming that you:

* work for several different clients
* possibly even in several different countries
* are marketing your services to potential clients with the aim of getting work
* are not entitled to any benefits from your clients that a "normal" employee would receive (sick pay, holiday entitlement etc)
* are responsible for the cost and time of correcting any errors you make
* you are not obliged to accept work from any of your clients
* your clients are not obliged to provide you with regular work
* you can choose the time when you work and the location
* you provide your own equipment
* you are paid per job rather than an hourly rate / salary
* you risk bad debt through invoicing

I could go on, but I think you get the general idea! These points should help you justify to your client that you are in fact independent, otherwise they will have to provide you with regular work, pay holiday benefits, tax and so on.

HTH,

Joanne

[Edited at 2003-06-19 09:11]


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Klaus Herrmann  Identity Verified
Germany
Local time: 01:30
Member (2002)
English to German
+ ...
My 0,02 € Jun 19, 2003

As far as I am concerned, I'm running a company offering a variety of services. When I reply to a job offer, I'm not asking for employment. Joanne has pointed out quite eloquently why we should consider ourselves a company.

Ursula Peter-Czichi wrote:
How much information should I supply? Should it include such information as the Social Security Number (for US citizens) before the first project has even been distributed?


Considering my business a company logically leds to not providing too much personal detail. My limit is a CV - I won't send out CVs. If you go to a doctor, do you ask for his CV before he's taking an X-ray? If you're in need of a plumber, do ask to bring his CV and 5 ft of copper tubing? I don't think so. Experience shows that this is a realistic approach, btw. None of my clients has asked me for a CV. By now most of them know about my vita because we've been working together for a long time, but talking about what university we went to was always in a casual setting.

[Edited at 2003-06-19 10:23]


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Carolyn Denoncourt  Identity Verified
United States
Local time: 19:30
Member (2004)
French to English
+ ...
US firms may need your social security number.... Jun 19, 2003

I'm not a lawyer either, but here is my understanding of an applicable US Tax rule: If you are US based and you provide services for a US firm (as an independent contractor) valued at more than $600 in a calendar year, then the US firm must file a form (1099, I think) stating total amount paid to you that year and your social security number or tax payer ID number if you have one. Therefore they will need your social security number if you actually work for them, but you do not have to give it just to be included in their database. Note that having a SS# when you are US based does indicate you are legally able to work in the US, so you may want to give it even for a database.

Here is the link to the tax information if you want to know more: http://www.irs.gov/pub/irs-pdf/i1099m03.pdf


[Edited at 2003-06-19 13:34]


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Maria-Jose Pastor
Local time: 19:30
English to Spanish
+ ...
Independent Contractor Jun 19, 2003

As Carolyn stated, even as an independent you must supply your SSN to the agency and/or direct client especially if you are going to or have earned more than $600 in the calendar year.

The IRS has strict guidelines defining who is an independent contractor. Here's a site that can help you out and includes the IRS's guidelines.

http://library.lp.findlaw.com/articles/file/00468/004035/title/subject/topic/labor%20%20employment%20law_employment/filename/laboremploymentlaw_2_81

Should you have any further questions, I would suggest contacting a tax accountant.


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Ursula Peter-Czichi  Identity Verified
United States
Local time: 19:30
German to English
+ ...
TOPIC STARTER
Thank you for your helpful comments! Jun 19, 2003

Your answers reflect what I have been thinking about this issue. If and when I work for a client I will provide all the required information as needed, including tax ID. However, I am concerned about freely putting my Social Security Number into just any data base.

This concern was triggered when I handed in a test translation together with an application form. The short original "test" included serious mistakes in the original, and the application form would have been a disgrace in the portfolio of any computer literate person. Their emails lacked a salutation and sported quite an unconcerned attitude. Yet, this package was sent by a seemingly established agency.

So far, I have had a very relaxed attitude about the security of my personal data. However, those times are over. It has become too easy to appear as an agency or PM.

I think it is prudent to be very careful out there in this new cyberworld.


Thank you all for your helpful input,

Ursula


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KabaVan  Identity Verified
Local time: 16:30
Japanese to English
+ ...
For all you Canadians out there Jun 19, 2003

Here are the CCRA's (Our version of the IRS) tests for being employed or self-employed.

http://www.ccra-adrc.gc.ca/E/pub/tg/rc4110ed/rc4110ed.html

I bet that most of us could be considered independent contractors as well.


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Yoanna  Identity Verified
United States
Local time: 17:30
English to Polish
+ ...
But is it safe? Nov 16, 2004

Carolyn Denoncourt wrote:

I'm not a lawyer either, but here is my understanding of an applicable US Tax rule: If you are US based and you provide services for a US firm (as an independent contractor) valued at more than $600 in a calendar year, then the US firm must file a form (1099, I think) stating total amount paid to you that year and your social security number or tax payer ID number if you have one. Therefore they will need your social security number if you actually work for them, but you do not have to give it just to be included in their database. Note that having a SS# when you are US based does indicate you are legally able to work in the US, so you may want to give it even for a database.

Here is the link to the tax information if you want to know more: http://www.irs.gov/pub/irs-pdf/i1099m03.pdf


[Edited at 2003-06-19 13:34]


I am just filling out a standard agency questionnaire and they request my SSN. Is it safe to give it to them [is it standard???] with all that identity theft going on in the US, I am concerned...

Please help - should I? What do you usually do, dear colleagues, with such applications?


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Susana Galilea  Identity Verified
United States
Local time: 18:30
English to Spanish
+ ...
you may ask for a W-9 form instead Nov 16, 2004

Yoanna wrote:
I am just filling out a standard agency questionnaire and they request my SSN. Is it safe to give it to them [is it standard???] with all that identity theft going on in the US, I am concerned...

Please help - should I? What do you usually do, dear colleagues, with such applications?



If this is an application from a reputable agency, I would not worry about it. The reason they need your SSN is so that it is on file when tax season comes around. Also, as someone else mentioned, it is proof that you are legally allowed to work in the U.S.

If you have any concerns, you could leave that info blank on the application and request the agency sends you instead a W-9 form (Request for Taxpayer Identification Number and Certification) for you to complete. There really is no "standard" when in comes to paperwork, so you should feel free to make that request.

Cheers,

Susana Galilea
Accredited Translator EUTI
sgalilea@ispwest.com
www.accentonspanish.com


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Yoanna  Identity Verified
United States
Local time: 17:30
English to Polish
+ ...
Thank you! Nov 18, 2004

The taxpayer's number IS my SSN and yes, I think that's what a different agency wants to send to me. The first one is rated OK on the BB so I guess I will fill it out.

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