[Discuss] Mass. outlawed independent contractors in software and other creative professions in 2004

[Tom Metro]

MBR wrote:
> http://www.wbur.org/2010/06/30/independent-contractor-law.
>
> A 2004 change to Mass. law that software temp agencies have only
> recently discovered, makes it effectively impossible for programmers and
> people in other professions who create intellectual property to operate
> as independent contractors.

Has here anyone lost a contract because of this? (Specifically, the 2004
provisions. The article cites a case or two.)

As pointed out in the article, this was a worsening of a law that dates
back to the early 90's. In the 90's I did run across business that would
only hire through agencies.

The worse part is that most independent contracts are probably not even
aware that companies are steering clear of them because of this and the
related federal rules. It trains businesses to either 1. hire W2
employees, or 2. a contractor through an agency. So they never even go
looking for a contractor outside that universe.


> The 2004 law was passed because construction workers and other unionized
> workers were finding that employers were forcing them to set up phony
> independent contractor status so the employer could get out of providing
> benefits.

The article depicts the union leader as being pretty obstinate and
indifferent to the damage the law does to other industries.

There seems to be some details missing from the scenario where a
contract drywaller willingly accepts a contract rate that doesn't cover
the cost of benefits that he would get as an employee. If you know
employees are getting $25/hour plus $20/hour in benefits, insurance, and
employment taxes, why would you accept less than $45/hour? If you're
desperate for a job, then you'd be just as apt to work W2 for a
sub-standard wage, and the employer could save money that way.

If the union sets the minimum wage for W2 and not 1099, then that seems
to be a far easier problem for the union to fix than changing a law that
impacts every industry.

If its about an employer saving the cost of worker's comp insurance,
then mandate that the 1099 contractor show proof of insurance to the
employer, and hold the employer accountable for hiring only contractors
with insurance. (Much like proof of citizenship is required for employment.)


> ...if you're forced to be a W-2 employee rather than an independent
> contractor, you lose any right to anything you create.
> ...
> And that means they can no longer own what they create.

I didn't follow this argument.

Yes, in the absence of contracts, a 1099 vendor can retain ownership in
goods they supply, and a W2 employee falls under the "work for hire"
provision of copyright law, so the employer retains the IP.

But that describes an unrealistic scenario. A contractor - as the name
implies - works under a contract, and that contract inevitably includes
a clause saying the client retains the IP, unless they've specifically
negotiated to retain it. And more importantly, I'm not aware of any law
that prohibits an W2 employment contract from granting IP rights to the
employee.

So either this argument is a disingenuous red herring, or I'm missing
something.

 -Tom

-- 
Tom Metro
Venture Logic, Newton, MA, USA
"Enterprise solutions through open source."
Professional Profile: http://tmetro.venturelogic.com/