Worker classification audits help you ensure your freelancers are correctly classified as independent contractors, protecting your business from potential legal and financial risks. By identifying compliance concerns early, you can stay aligned with local labor regulations and maintain healthy professional relationships.
Overview
A worker classification audit is a specialized service provided through Fiverr to help clients clarify the nature of their working relationship with freelancers.
- What it does: Uses a third-party expert, Greenlight, to evaluate if a freelancer is an independent contractor or should be classified as an employee.
- Why it's useful: Reduces the possibility of misclassification, which can result in significant legal consequences and financial liabilities.
- Who it's for: This service is available for Fiverr Pro clients who have worked with freelancers for a long period.
Before you begin
- Eligibility: Audits only apply to self-employed individuals (freelancers) and can be requested only by Pro clients.
- Order requirement: You must have purchased and completed at least one order with the freelancer being audited, either for a specific order or for hourly services.
- Third-party process: The audit is conducted by Greenlight, a trusted third-party, and not directly by Fiverr.
- Platform limitations: The service cannot be paid for using Fiverr credits or promo codes.
How it works
The audit process is designed to be thorough and transparent, typically taking up to 16 days to complete.
Audit process & triggers
- Questionnaire: You will answer a screening questionnaire regarding daily management, worker substitution, exclusivity, and internal staff roles.
- Freelancer authorization: The freelancer has 14 days to authorize the audit request.
- Review: Once authorized, the review takes up to 2 days.
Understanding results
Once completed, you will receive an email with one of two statuses:
- Low risk: The freelancer is correctly classified as an independent contractor.
- High risk: The freelancer could be classified as an employee, posing legal implications for your company.
Payments & refunds
- Cost: Fees depend on your specific subscription plan.
- Discounts: Pro clients subscribed to the Advanced plan are eligible for a 10% discount.
- Refund policy: You can request a refund within 24 hours of your initial request. After 24 hours, refunds are no longer processed.
How to request an audit
- Locate the banner:
- First-time clients: Go to the freelancer's profile or your inbox and click the Ensure this freelancer is compliant with your business banner.
- Existing clients: Click Worker classification located under the freelancer profile or in your inbox.
- Select service: Click Worker classification.
- Complete screening: Answer all required questions in the questionnaire.
- Make a payment: Select an available payment method or use your deposit balance to complete the request.
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Track progress: Monitor the audit status in your dashboard until you receive the final email notification.
Best practices for addressing risks
If an audit reveals a high-risk status, consider the following steps to protect your business:
- Consult experts: Work with employment law or HR professionals to evaluate if you need to reclassify the worker or utilize Employer of Record (EOR) services.
- Update contracts: Ensure contracts reflect the independent nature of the relationship by limiting day-to-day oversight and redefining the scope of work.
- Train your team: Educate your staff on managing independent contractors properly to prevent future compliance issues.
FAQs
- The process can take up to 16 days. This includes a 14-day window for the freelancer to authorize the request and a 2-day period for the third-party expert to conduct the review.
- The freelancer has 14 days to respond to the request. If they do not respond to the audit within this timeframe, the request will expire.
- Refunds are only available within the first 24 hours of submitting your request. After this 24-hour window, the payment is non-refundable.
- The audit is conducted by Greenlight, a third-party compliance expert. Greenlight bears sole responsibility for the results, and Fiverr is not liable for the outcome of the audit.
- Not necessarily, but it indicates a high potential for misclassification. You should consult with legal or HR professionals to determine the best course of action, such as adjusting the contract or using an Employer of Record (EOR) service.
Important: Fiverr does not provide specific legal advice regarding your engagement with freelancers. The decision to engage or decline to engage any freelancer remains at your exclusive discretion.