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What is disguised employment as a freelancer?

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How to avoid the risk of disguised employment as a freelancer?
Definition and recognition of signs of disguised employment
What is disguised employment?
Key indicators revealing a situation of disguised employment
Our strategies to maintain your independence as a freelancer
Negotiate contract terms
Seek legal advice
In summary
FAQ
What are the main characteristics distinguishing an autonomous freelancer from a disguised employee?
What are the legal and financial risks faced by a company if a freelance contract is reclassified as disguised employment?
How can an independent worker preserve their autonomy to avoid being reclassified as a disguised employee?
Which common practices in freelancer-client relationships encourage the risk of disguised employment?

How to avoid the risk of disguised employment as a freelancer?

Disguised employment describes a situation where an independent worker, such as a self-employed or micro-entrepreneur, operates like an employee under the guise of a service contract. This phenomenon is characterized by a subordinate relationship, including directives, imposed working hours, and strict control, sometimes even leading to sanctions. This contradicts the very essence of independent status.

Such concealment can lead to a reclassification as an employment contract by labor courts, requiring the employer to pay social contributions, unemployment benefits, and uphold rights related to paid leave and sick leave.

To avoid the risk of disguised employment, it is vital to distinguish the signs between employment and independence. This article helps you identify these criteria and legally safeguard your activity while preserving your autonomy.

Definition and recognition of signs of disguised employment

What is disguised employment?

Disguised employment refers to a situation in which an independent worker, often a self-employed or micro-entrepreneur, carries out a mission for a company in conditions similar to those of an employee, without benefiting from social rights or the legal protective framework. Although this worker is under a service contract or maintains an independent relationship, they are subject to a subordinate relationship, characterized by precise directives, control over their activity, and obligations regarding the execution of the work.

This ambiguity, whether intentional or not, between independent work and employment, constitutes a form of undeclared work. It exposes the company to criminal and financial penalties, especially in the event of reclassification before labor courts. It is crucial to distinguish this situation from the legally autonomous status of the entrepreneur, who retains autonomy in managing their activity, choosing their clients, and organizing their work.

Wage portage represents an interesting solution for freelancers wishing to carry out their activity safely while avoiding the risk of disguised employment. Thanks to this hybrid status, the professional retains their autonomy in choosing assignments and clients, while benefiting from the protection of employee status, including social security contributions, unemployment coverage, and retirement benefits. It also helps to legally secure your business while allowing you to focus on your expertise and projects.

Key indicators revealing a situation of disguised employment

Several elements can help identify a situation of disguised employment. Although no single criterion is decisive by itself, their accumulation forms a body of evidence:

  • The worker is clearly subject to a subordinate relationship. This means they must comply with directives, working hours, and locations imposed by the client, with the possibility of sanctions for non-compliance.
  • The work is carried out exclusively for a single contracting client, which reduces the worker's autonomy and creates economic dependence.
  • The absence of a formal service contract or precise specifications, creating uncertainty regarding the definition of the independent assignment.
  • The worker uses the client's materials, premises, and tools, unable to organize their work freely.
  • The invoicing is fixed, for example monthly, without direct connection to the delivery of a specific service or result.
  • The worker cannot freely choose their clients or set their rates.

The combination of these criteria highlights disguised subcontracting, which may legally be reclassified as an employment contract. This reclassification results in sanctions for the company and the recognition of social rights for the worker.

Our strategies to maintain your independence as a freelancer

  1. Diversify your clients

Are you starting out as a freelancer? To preserve your status as an independent entrepreneur and avoid any situation of disguised employment, it is crucial not to depend on a single contracting client. By working with several clients, you reduce your economic dependence and affirm your autonomy in your business.

This diversification also allows you to better negotiate working conditions and service contracts. It proves that you are running an independent business rather than being bound by an employment contract.

Collaborating with multiple clients expands your portfolio, gives you the opportunity to tailor your services to the specific needs of each client, and protects you from the risk of exclusive subordination, which could be an indicator of disguised employment. By diversifying your activities, you increase your organizational freedom, which is essential for maintaining your status as an independent worker.

Negotiate contract terms

To avoid any risk of disguised employment, it is essential to carefully negotiate the terms of the contract that binds you to your clients. The contract should clearly specify the nature of the relationship: a service contract or subcontract, free from any hierarchical obligation.

Make sure that the contract explicitly defines your autonomy in organizing the work, the modalities and deadlines for delivery, the conditions of invoicing, as well as the absence of direct instructions concerning execution. You may also include clauses ensuring your freedom in choosing the means employed and your right to refuse certain requests that could amount to employer-like control.

Finally, remember that this precise contractual framework serves as proof in the event of a dispute before the labor courts, especially if a subordinate relationship is challenged. A thorough understanding of the contract terms is essential to protect your self-employed or micro-entrepreneur status.

Preventive and reactive actions in the event of risk of disguised employment

Warning signs and first actions to take

It is essential to remain alert to warning signs which may indicate a situation of disguised employment. These signs include in particular:

  • Imposition of fixed working hours.
  • Obligation to work at the client’s premises.
  • Exclusive use of the client company's equipment.

Upon detecting these signs, the first step is to initiate a dialogue with the contracting client. This helps clarify and negotiate the terms of the assignment. It is important to highlight the specifics of self-employed status, especially the need to maintain autonomy in organizing work.

To avoid any legal ambiguity, it is strongly recommended to formalize a detailed service contract. This document should clearly define the terms of the collaboration.

In summary

To avoid any risk of disguised employment, it is vital to maintain genuine autonomy in the organization of your work. Diversify your clients so you do not become financially dependent on just one of them.

Also, make sure to negotiate the terms of the service contract clearly and precisely to confirm your independent entrepreneur status. If you have any doubts, consult a labor law expert to secure your situation and prevent potential sanctions.

Act today to preserve your freedom and guarantee the safety of your freelance activity.

FAQ

What are the main characteristics distinguishing an autonomous freelancer from a disguised employee?

An autonomous freelancer is free to select clients, organize their schedule, set their fees, and is not subject to a subordinate relationship. In contrast, a disguised employee receives orders, has imposed working hours, and is under the company’s control, while being deprived of the rights granted to employees.

How can an independent worker preserve their autonomy to avoid being reclassified as a disguised employee?

To avoid reclassification as a disguised employee, an independent worker must maintain autonomy by freely organizing their work, setting their working hours, and selecting their clients. They should also manage their invoicing, accounting, and contracts without being subjected to hierarchical control.

Which common practices in freelancer-client relationships encourage the risk of disguised employment?

The risk of disguised employment increases when the freelancer is subject to a legal subordinate relationship, such as imposed working hours, working exclusively for a single client, using the client’s equipment, strict control over execution, sanctions, or having to work on the client’s premises. Such practices undermine the independence required for freelance status.

Photo de profil de Lina MOREL

Responsable Marketing & Communication chez Weepo, je suis passionnée par l'animation du réseau et l'accompagnement de nos consultants. J'organise des événements parisiens et accompagne nos équipes régionales pour créer des moments d'échange enrichissants dans l'écosystème du portage salarial.