DOL Ratchets Up Campaign Against Independent Contractor Misclassification

The Wage and Hour Division (WHD) of the Department of Labor (DOL) today issued another broadside against employer misuse of the independent contractor job status to avoid the responsibilities of labeling and treating a worker as an employee.

WHD administrator David Weil issued an interpretation titled “The Application of the Fair Labor Standards Act’s ‘Suffer or Permit’ Standard in the Identification of Employees Who Are Misclassified as Independent Contract,” in which he broached the longstanding independent contractor litmus test based on “economic realities.”

He observed: “In order to make the determination whether a worker is an employee or an independent contractor under the FLSA, courts use the multi-factorial ‘economic realities’ test, which focuses on whether the worker is economically dependent on the employer or in business for him[self] or herself.”

Weil further explained:

In applying the economic realities factors, courts have described independent contractors as those workers with economic independence who are operating a business of their own. On the other hand, workers who are economically dependent on the employer, regardless of skill level, are employees covered by the FLSA.

And he concluded, “In sum, most workers are employees under the FLSA’s broad definitions.”

Administrator’s Interpretation No. 2015-1” of July 15, 2015, can be viewed and read here.

NOTE: The details in this blog are provided for informational purposes only. All answers are general in nature and do not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The author specifically disclaims any and all liability arising directly or indirectly from the reliance on or use of this blog.
You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

Leave a Reply

Your email address will not be published. Required fields are marked *

* Copy This Password *

* Type Or Paste Password Here *

Leave a Reply

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Comments (required)*