I was recently "laid off" (with the rest of my department) only to be re-hired the same day I was terminated, this time as a "Freelancer." I am still payrolled, work the same hours (50/week), sit at the same desk, and report to the same person, except I am now without health insurance and benifits that my supervisor enjoys. Is this legal? Or just unethical?

What do you do?

Who controls when you work, what you do, how you do it?

If you cannot be classified as an Independent Contractor, then the company is wrong and could get in trouble with the IRS.

If you could be so classified, why the change?

More importantly, for you, is your pay going up to compensate in any way for the loss of benefits?

This situation reeks to high heaven.

The company controls when, where, and how I work, as they did before. I am not permitted to work for any other companies... I work in Event Production where about 50% of the workers are freelance, but they elect to be and have never had full-time status. I was full time, and had my benefits taken away. I do not invoice, I complete a timesheet and am paid on the books without insurance.

I'm on Cobra now, they do not pay towards any of my benefits anymore.

Thanks for your reply.

While I don't disagree with Scott, I'd like to point out that they could have legally cancelled the health insurance, changed the benefit policy and left everything alone. The law in your state, or in most states, does not require that the employer provide health insurance.

Let me redefine the question.

What do you do, exactly, for the company? The nature of your work related tasks will help us to figure out your status.

Also, do you still have taxes being taken out of your check? It is possible to be an "employee" without having benefits and words like "freelancer" mean whatever the person who says them wants them to mean.

Yes, taxes are being withheld.

I understand that the company can change the benefit policy, but would it not have to be for the whole company, as opposed to just a few people? My understanding is that everyone "full time" who receives benefits, must receive the same benefits? By changing us to "part time / Freelance" -while still working the same hours, aren't they just skirting the system so they can remove some people from the benefits (about 20% of the office).

I'm a Coordinator, I make sure all of the vendors and graphics people get the info and are on schedule.

It is not true that all full time employees must receive benefits if anyone does.

The employer may legally carve out certain classes of employees to receive benefits. While most employer choose to break it down as full time versus part time, it is also legal to do it as office vs. shop or field, only certain departments, only certain levels of employee (ex. only managers and up) and so on. What they cannot do is offer only to employees based on protected characteristics; only men but not women, only Hispanics but not Asians, only those under 40 and not over, etc.

Once the eligible classes have been determined, everyone in the eligible class must be offered benefits. But it is legal to have ineligible classes of employee. At one job I held, only full time managers, no one else, were eligible.

Now IF he has changed your class for the SOLE purpose of denying you benefits to which he would otherwise be eligible, that's illegal. But I will again point out that if he wants to change the plan document to state that freelancers are not eligible for benefits, he can do that.

Interesting, I didn't realize they could just take away benefits like that. I'm guessing that they "laid off" the employess to terminate our contracts that outlined the benefits we received with employment.

One question, didn't Walmart get in trouble to covering health insurance for managers, but not full time employees? Just thinking back now, that must be where I got the idea that all full time employees (30+ hours) must be given the same benefits.

Thanks agian for the help!

If you're thinking of the case I think you are, that had to do with a state law in Maryland and would not apply here.

My understanding is that everyone "full time" who receives benefits, must receive the same benefits?

No. The company can set up the benefits plans the way it wants. A production worker need not receive the same benefits as an office worker and neither need receive as much as a manager.

It may not be fair (expect to see JoeC very soon), but that is legal.

It would appear from your posts that exactly what your employer did is exactly what you think they did. Cut benefits for a class of employees. Although it may be "legal" on the surface is it an employer you wish to continue doing business with? I would be on the hunt the day this happened. When they get away with this today no telling what they will try, and perhaps skirt sround enough laws to get away with, in the future. The group of 20% that had this pulled on them would be wise to organize, bind together, and refuse to continue working until your benefits are restored at full value. Otherwise you will most likely be better off seeking employment for someone who has scrupples and a tad of integrity.

Good Luck to you