my job wants me to be both an employee and a contractor

A reader writes:

I’ve worked part-time at this company for a little over a year. It’s my first job out of college. I work in events, so my hours can vary wildly — during the weeks leading up to an event, I can be working 35-45 hours a week, but the slow times can be 5-15 hours a week. I’ve been promoted once already since working here, about eight months in, to a role that was sort of invented for me. It’s very much a small, creative, wear-a-lot-of-hats kind of company.

We have another big event coming up, and the event’s producer has approached me about taking on two additional roles for this project (in addition to my current one). In my current job, I’m responsible for setting up and running events.

The first new role was for me to join the production team as an assistant, in addition to my regular role. This would be an hourly part-time position at my regular rate (and represents work that I’ve already been doing in some ways anyway), so I’m happy to accept that.

My question is about the other role they’ve asked me to take on: to also be a designer for this event (again, on top of my regular roles). With the way it was pitched to me, this would be a contract position separate from my hourly work, and the money from this job would get paid out to me as a bonus at the end of the year (I believe this is to prevent me from being listed as both an employee and an independent contractor, but I’m not entirely sure on the details). I suspect this is at least in part because during the last big event there was frustration that I was an hourly employee and couldn’t work more than 40 hours/week (they really try to avoid paying overtime; most of our salaried employees were working 50-70 hours a week, and it was noticeable that I had to leave before the rest of the team).

I’m still waiting for them to get back to me with actual contracts (and numbers!) on all of this, but … this is a bad idea, right? I’m really trying to make positive impressions at this company before I hopefully move on in a year or two, and getting extra money at a time when there is more work available would help a lot during those slow months. But I also have concerns:

These three jobs are all somewhat related by their very nature, and I’m worried about not knowing whether work fits within my production role or design role (and thus whether it’s paid time or part of that lump sum).

1. I’ve worked as this kind of designer a handful of times previously, and while I love the work, it’s a really hard job to set boundaries around (it’s susceptible to a lot of scope creep and it’s hard to predict how big the job will be before you sign a contract). I’m worried that we could get into situations where I hit 40 hours in a week and get told, “It’s not a big deal, just clock out and the rest of the time will be part of your design work.”

2. I’m also not entirely sure how legal this all is. I’ve done research on employees also being contractors, but all of the info I can find is for really unrelated roles with a clear division of duties (i.e., a receptionist who is also employed as a janitor on the weekends). Apparently this set-up of taking on additional work in exchange for an end-of-year bonus is something the CFO has set up in the past, but I don’t yet have a contract from them to look at how it’s actually structured. In case it matters: we’re based in California, and it’s possible that before accounting for the bonus this would leave me making less than minimum wage (design hours + regular hours / hourly rate for the regular hours).

So my question: is this as bad of an idea as I think? Are there ways of making this work that would make it more feasible (I’ve floated the idea of making the production and design roles both part of the same contract, which is easier as far as knowing which work counts as what, but I’m not thrilled about the idea that a ton of the work I do in August won’t get paid out until December).

This isn’t legal!

Because you’re non-exempt, you need to be paid for all hours you work, including overtime for any hours over 40 within a week. (And in fact, because you’re in California, you also need to be paid overtime for any hours over eight you work in a day.) You need to be paid for those hours in the paycheck for that pay period, not at the end of the year … and not as a lump sum that might not correlate to the specific number of hours you worked.

Your employer can’t get around that by making part of your work “contract work” on top of your regular employee work.

In theory, they could make you a contractor for an additional job on top of your work as an employee, but it would need to be very different from the work you’re already doing (your receptionist vs. janitor example was a good illustration of what would be allowed), and setting up/running events is not sufficiently different from event design to qualify.

You’re also absolutely right to worry that that they’ll just try to allocate any overtime hours to the “design job,” thus conveniently getting them out of paying you for them.

Anyway, the whole thing is a no-go because it’s illegal. And that’s the best way to approach it: “I looked into it, and legally we can’t do it that way. We’re required to pay non-exempt employees for all their work in the corresponding pay period; it can’t be a lump sum at the end of the year.” If they push you overlook that and do it anyway: “I wouldn’t be comfortable doing that since legally we can’t, and I don’t want us to risk getting into trouble.”

You could also say, “I’d be happy to do the work as part of my regular job, but it’s likely to mean logging overtime hours, which I know we’d rather avoid — so it might not make sense for the company to have me take that on.”

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