How to avoid paying overtime and to evade pesky employment laws? Treat your workers as “independent contractors.” Problem solved. Or maybe not. An appellate court has reminded employers again about the costly consequences of misclassification.
In Scantland v. Jeffry Knight, Inc., No. 8:09-cv-01985-EAK-TBM, 2013 WL 3585635 (11th Cir. July 16, 2013), the Eleventh Circuit considered the classification of a group of current and former technicians who installed and repaired cable, internet, and digital phone services. The Court found the technicians walked the “usual path of an employee.” The company exercised significant control over the technicians, dictated the technicians’ opportunity for profit and loss by controlling work orders, and created exclusive and lengthy relationships with the technicians. Those factors demonstrated the technicians were economically dependent upon the company and thus required the employer to classify the workers as employees.
Plaintiffs’ attorneys—and, more recently, both state and federal Departments of Labor—continue to seek out employers who have misclassified their independent contractors, often resulting in substantial judgments and settlements for current and former employees. There’s no better time than now to evaluate your own workforce and prevent costly classification mistakes.