our BLOG

The DOL Weighs In On Independent Contractor Classifications

Jul 16, 2015 12:33:58 PM / by Michelle Montoya posted in hr compliance, Independent Contractor, independent contractor classification, U.S. Department of Labor, classification process, "economic realities" test, Employee, Employee or Independent Contractor, Fair Labor Standards Act, independent contractor classifications, Michelle Montoya



Employers have long grappled with the delicate balancing act of employee and independent contractor classifications, and recent high-profile court cases served to renew focus on the matter.  On Wednesday, July 15, the U.S. Department of Labor (DOL) joined the discussion with the issuance of what it calls a "litmus test" for employers to use in the classification process.

The guidelines seek to clarify, not change, existing law under the Fair Labor Standards Act, and specifically expand upon the "economic realities" test employers are to use when classifying a worker as an independent contractor.  Under this test, factors such as the employer's degree of control over the worker and work product, the permanence of the work relationship, and the level of skill required of the worker are to be considered as a whole.

While greater clarity has long been desired by employers who struggle with classification questions, the guidelines may not be welcome relief.  The guidelines place greater weight on employee classification and make the bona fide classification of an independent contractor more unlikely.  This expansion of the definition of an employee is not surprising given the DOL's aggressive approach that employee misclassification deprives workers of important benefits such as overtime pay and workers' compensation.  The new guidelines all but guarantee the critical oversight will continue, particularly in industries that rely heavily on independent contractor relationships.

Independent contractors can continue to be a worthwhile solution for many businesses. However, in light of the guidelines, employers will be wise to revisit independent contractor classifications and confirm that the relationships pass muster under the refined "economic realities" test.

Read More

DOL Releases Proposed Changes to FLSA Overtime Regulations

Jun 29, 2015 3:16:38 PM / by Michelle Montoya posted in Federal Register, hr compliance, overtime pay, U.S. Department of Labor, extend overtime protections, Fair Labor Standards Act, Michelle Montoya, overtime regulations, Wage and Hour Division of the U.S. Department of L



On June 30, 2015, the Wage and Hour Division of the U.S. Department of Labor (DOL) released a proposed rule to update overtime regulations under the Fair Labor Standards Act (FLSA). Specifically, the proposal will update the definition that determines which white collar workers are eligible to receive overtime pay.

Read More

The Silliness of Pay-or-Play Calculators

Jun 7, 2013 8:41:04 AM / by Michelle Montoya posted in ACA, Affordable Care Act, Michelle Montoya, pay-or-play, rewards, risks



As the resident health care reform geek, I get questions from our clients every day regarding various articles they read or emails they received about the Affordable Care Act (ACA.)  Most are very good questions (it’s a complex law), but all too often the question is coming from an email that was designed to scare them so the sender can sell them something.  The one I find most absurd is the concept of Pay-or-Play.  “You need to meet with us because we have a calculator that tells you if you need to Pay-or-Play!”

Read More

Can We Make FMLA Easier?

Feb 15, 2013 7:59:08 AM / by Michelle Montoya posted in hr compliance, FMLA, FMLA leave, HR Professionals, Michelle Montoya



There is no law that strikes more fear in the hearts of HR Professionals than FMLA. While most of us agree with the concept of giving time off to employees to care for themselves and their family members, the plethora of forms, constantly evolving regulations and general employee confusion make it almost impossible to manage employee leaves in a smooth and consistent basis. On top of that, California has its own version…which, of course, has to work just a little bit differently.

Read More

Subscribe to Email Updates

Lists by Topic

see all

Posts by Topic

see all

Recent Posts