What Is a 1099 Employee? A 1099 employee is quite commonly known as an independent contractor; he/ she is a self-employed individual hired to execute tasks on a contractual basis for a client. Unlike the regular employees, these employees are not on the direct payroll of the parent organization and thus miss out on employee benefits ranging from insurance policies to health insurance. As opposed to the monthly salary system, they are paid against the raised invoices for the tasks they executed during the mentioned period. While the employees have their taxes withheld, the 1099 employees are responsible for their taxes. What Are Independent Contractors and Employees? The degree of control and freedom in their working relationship distinguishes independent contractors from employees most of all. Independent Contractors: They are free to decide on the location, time, and method of execution for their assignments. They might serve several clients at once and consistently deliver their services. Employees: Their work schedule, methods, and procedures are under direct oversight by their company, which also shapes their jobs. Usually, employees make use of tools offered by their organization, which are essential for its operations.