Working as an Independent Contractor

Does anyone have any insight as to the following: I left one of the main companies to be an Independent Contractor for one of the smaller companies and so far it seems I have been working for free. I have already logged in 45 hours of unpaid work for things they require me to do such as training, filling out paperwork, computer issues, driving to get PIV card, etc. It doesn’t seem legal that a company can ask you do things/activities for them and then not pay you. Any insight?

It is absolutely not right, but is the dirty secret off contracting. It is a big reason I got out of the business. The companies are required by their government contracts to document hours of training, orientation, etc., but do not pay contract employees for those hours. If you were a regular employee you would be paid for that time. Your activities are benefiting the company, not you.

As they say, there ought to be a law.


You are an independent contractor and no longer an employee. If you were doing those things as an employee, you would be paid for it. However, as a contractor, the company is not required to pay you for any of those activities. Further, if they did pay you, they would be opening themselves up to potential litigation because they would be treating you the way they do an employee. The activities you mention are requirements of the independent contractor “position”. Per the IRS, independent contractors are considered self-employed. I recommend getting a good tax person so you can account for as much as you can when you file your taxes.


Very good point. Among the many unexpected negatives of being a 1099 employee… or ‘worker’

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You are starting your own business - getting licenses, buying office equipment, etc. These are all start-up costs, as are the nitty-gritty training requirements for this job. You will need to learn to evaluate if an item or case payout is worth your time (and refuse certain assignments if they don’t make you money - drive 60 miles, get a record, drive back and input it for $35). Just my 2 cents.


Correct, I don’t see how a company can ask someone to do something then not pay them, regardless of whether you are an actual employee or independent contractor. I thought about sending them a bill and seeing whether or not they would reimburse me for all the activities/assignments/requests they’ve made me do without pay.

If you do not understand the difference between employee and contractor and how one is paid versus the other, you probably should not be a contractor. As a contractor, you are not required to do what they ask you…you can say no. However, you then are not able to accept/complete and bill/invoice the company.


You’re used to being an employee but that’s how self employment works, at least in this industry. Nothing strange here. It may not be the most ideal, but Yes you have to make your own investments (training without pay) and cover your own costs. Later you get the benefit to write off your mileage and expenses and as much else as you can at tax time.

Pros and cons like anything else.


Hello, Im thinking about returning to being an I/C for one of the DCSA contractors and since its a sub, I have to go thru the process which is pretty easy Have things changed much since the days of PIPs and how streamlined are typing up subject interviews, source and records, also, do they still have ESIs which at the time was a full “spin” interview and what are some of the amts paid now for interview, records, mileage, etc? Thanks-

There have been independent contractor lawsuits in CA against one of the big companies for the reasons you mentioned. Contractors were required to attend meetings and trainings but were not paid and it was determined to be breaking unemployment laws. This is the reason “zero hour employee” status was created. ZHE’s are in a sort of limbo employee/contractor status and all independent contractors working in CA at that time converted into ZHE. The independent contractor thing is a complicated situation that these companies try to navigate, but seem to wind up getting sued over and over again every few years. Their memory seems to be short.

What state are you working in?

Im looking in the New England area, I already have a full time job and am looking for about 10-20hrs a week. Back about 10yrs ago, ESIs were $220 but Im sure they must be close to $300 now plus whatever source and records are billed at.

I think you will be disappointed. I’ve heard thru friends the reimbursement rate is about $215. But, I do believe there is probably premiums added for certain areas.

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Interesting that the reimbursement may have gone down from 10yrs ago. Ill see what develops.

Check out Paragon. I hear that they pay ICs very well. Plus, there’s no pressure to take work.

One of the most expensive states in the country. Get everything they quote you as “pay for source units” in writing. I’ve had multiple ICs tell me the original amounts quoted during the hiring process turned out to be incorrect.

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2019-2021 rates per one particular prime vendor were as follows:

ESI $200
Source $50
Record $25

Check Paragon. They are much, much higher.

Thanks, thats actually less than what USIS paid IC 10yrs ago. Hmmm…

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wonder if this will change come 03/2023.