Santa Clara University.... Whoops
Dear University of Santa Clara,
Whoops.
Sincerely,
Me
As this article describes, the University of Santa Clara converted several of its student leaders from employee status to independent contractors.
The article decries the fact that the students had to pay their own taxes AND "As independent contractors, students are now responsible for paying all of the social security tax, half of which is normally covered by an employer." Well technically they have to pay their all of their self employment tax is which kinda sort just like social security tax.
There's no mention in the article that none of the students appeared to have been taught the first thing about taxes... the only thing they can be certain of other than death. Talk about schools not teaching life skills. But I digress.
The article misses the fact that from the article the Employment Development Department (more so than the IRS, which the first commenter mentions) has an invitation to an audit. Converting employees into independent contractors without their knowing consent and without changing the underlying nature of their work relationship is a big red warning sign that ICs are being used incorrectly.
As anyone who has read this blog with any regularity knows, I'm not a big fan of the EDD, and think they've gone way over board on re-classifying ICs as employees. I wouldn't use the word "fraudulent" that the commenter who at least saw that this was a audit waiting to happen used. But if I, an avid supporter of the right of ICs to work as ICs and not be forced by a nanny state to become employees against their will, think these students may have been misclassified when USC called them ICs, well there's a good chance the EDD will agree.
