Misclassification

News & Analysis as of

DOL Refills States’ War Chests for Independent Contractor Misclassification Crackdown

The U.S. Department of Labor has awarded $10.2 million in grants to 19 states for continued independent contractor misclassification detection and enforcement. The grants are focused on unemployment insurance programs and,...more

New Hampshire Department of Labor and U.S. DOL Agree to Work Together Against Misclassification

The U.S. Department of Labor (“U.S. DOL”) and the New Hampshire Department of Labor recently signed a memorandum of understanding to share information regarding independent contractor misclassification. The agreement is part...more

New California Law Imposes Joint Liability on Businesses and Contract Vendors for Wage Violations and Workers’ Compensation...

For companies using independent contractors in California, 2014 has been a difficult year, with several significant court decisions threatening the contractor model. In June, the Ninth Circuit rejected the parties’ choice of...more

Employer Prevails on Misclassification Claim Where Employee Fails to Prove Hours Worked

Greg Holaway worked as a Field Service Engineer for Stratasys, Inc. He was categorized as exempt from the provisions of the Fair Labor Standards Act (FLSA) requiring the payment of overtime. Even though his title was...more

Gentlemen’s Club Cannot Strip Dancers of Employee Status

We mentioned early last year that the U.S. Department of Labor intended to start cracking down on the (mis)classification of workers as independent contractors. All is not lost however, as we also recently discussed a New...more

Employment Law Update - Independent Contractors: The NLRB Refines its Standards

Whether an individual is classified as an independent contractor or an employee has significant legal implications, because most federal and state employment laws do not apply to independent contractors. Independent...more

$10.2 Million Awarded by DOL to Detect Worker Misclassification

Recently, the U.S. Department of Labor announced awards of $10,225,183 in grants to 19 states to implement or improve worker misclassification detection and enforcement initiatives in their unemployment insurance programs. ...more

October 2014 Independent Contractor Compliance and Misclassification Update

- TAX COURT DECISION REMINDS COMPANIES THAT “OFFICERS” ARE STATUTORY EMPLOYEES AND THEREFORE CANNOT BE INDEPENDENT CONTRACTORS. The United States Tax Court held that a company that was engaged in the buying, reconditioning,...more

Supreme Court Declines to Hear Challenge of Illinois Independent Contractor Classification Law

On October 14, 2014, the Supreme Court of the United States refused to consider a challenge to the Illinois Employee Classification Act, which classifies workers in the construction industry as employees unless they can meet...more

Employment Law - Oct 2014 #3

DOL Grants Could Signal More Misclassification Actions - Why it matters: Employers have faced a tidal wave of litigation over the alleged misclassification of employees as independent contractors, with workers ranging...more

An Employee is an Employee is an Employee: Alexander v. FedEx Ground

In the 1920s, author Gertrude Stein famously said, “A rose is a rose is a rose.” In light of Alexander v. FedEx Ground, that phrase could just as well be: an employee is an employee is an employee. Alexander is one of many...more

State and Federal Departments of Labor Joining Forces to Fight Employee Misclassification

Last month, major North Carolina newspapers ran a series of investigative reports alleging that construction companies with federal contracts routinely misclassify employees as independent contractors. While these articles...more

Wage Order—Not Borello—Applies in Independent Contractor Status Test Says California Court of Appeal

The California Court of Appeal, Second District, issued an opinion on October 15, 2014, that considered whether the definition of “employee” from the Industrial Welfare Commission Wage Order No. 9 (Wage Order) or the common...more

Worker Classification Litigation on the Rise — An Analysis of the Ninth Circuit’s FedEx Case and Its Lessons for Tax Practitioners

Abraham Lincoln reportedly asked, ‘‘If you call a dog’s tail a leg, how many legs does a dog have?’’ His answer was, ‘‘Four. Calling a dog’s tail a leg does not make it a leg.’’ Similarly, when businesses classify workers,...more

US Department of Labor to Aggressively Pursue Misclassification Matters

Employers have many ways of getting into trouble. We hope that after reading this you will avoid one of them; namely, misclassifying employees as independent contractors. ...more

“Black Car” Drivers Found to be Independent Contractors

Recently, courts in highly-publicized independent contractor misclassification cases in the transportation sector have issued determinations finding the workers to be employees. However, a recent decision from the Southern...more

California District Court Finds Bankrupt Named Plaintiffs Not Adequate Representatives

Anyone questioning whether the Supreme Court’s decision in Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011), has had an impact need look no further than the decision in Alakozai v. Chase Investment Services Corp., Case...more

Conservative Kansas Joins the Liberal Ninth Circuit in Rejecting the Independent Contractor Classification of Delivery Drivers

Last month we blogged about two Ninth Circuit opinions that deemed FedEx Ground drivers to be employees rather than independent contractors under California and Oregon law. Last week the Kansas Supreme Court joined them,...more

Alabama Heightens Attention on Misclassified Employees

The U.S. Department of Labor continues its “misclassification initiative” by adding Alabama to its list of state partners. On October 2, 2014, Alabama Labor Commissioner Fitzgerald Washington and DOL regional director Wayne...more

But Wait . . . My Workers Are Independent Contractors, Right?

Following the U.S. Department of Labor’s recent release of its Memorandum of Understanding (“MOU”) with the Alabama Department of Labor, employers should not rest easy simply because they classify their workers as independent...more

NLRB Adopts New Test for Independent Contractor Misclassification, Applies it to Find FedEx Drivers are Employees Who Can Unionize

The NLRB has tossed a new vegetable into the enormous salad of independent contractor misclassification tests. As companies might expect, the new vegetable smells rotten. Companies who wish to analyze whether their...more

Misclassification Initiatives Spread as Alabama Signs Formal Pact with DOL

On October 2, 2014, the Alabama Department of Labor and the U.S. Department of Labor (DOL) entered into a formal Memorandum of Understanding (MOU) or agreement to share information regarding independent contractor...more

Court of Appeal Denies Certification in Another Misclassification Overtime Class Action

In the latest installment in a series of recent employment class actions, the Court of Appeal for Ontario has dismissed an appeal by class action plaintiffs in Brown v Canadian Imperial Bank of Commerce. The decision...more

First Circuit Favors Broad Application of Analogue to Airline Deregulation Act Preemption Provision

On September 30, 2014, in Massachusetts Delivery Association v. Coakley, No. 13-2307 (September 30, 2014), the First Circuit Court of Appeals overturned a lower court’s refusal to preempt a Massachusetts independent...more

September 2014 Independent Contractor Compliance and Misclassification Update

This month’s headline developments are the crescendo of cases finding against FedEx Ground’s classification of drivers as independent contractors. On the heels of last month’s decision by the U.S. Court of Appeals for the...more

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