The Department of Labor has just issued a new “Administrator’s
Interpretation” that more narrowly defines what it is to be an “independent
contractor.” Determining your work classification – whether
you are an employee (exempt or non-exempt) or an independent contractor
has great significance. Employees are generally entitled to benefits not
provided to independent contractors. Further, non-exempt employees are
entitled to earn overtime compensation whereas exempt employees and independent
contractors, are not. At the rate of one and one-half times the standard
rate of pay for all time spent working in excess of 40 hours, this amount
can be substantial. The new interpretation provides that the current reliance
on the degree of control a worker/employer has over his or her job should
not carry as much weight in determining a worker’s employment status.
Rather, the emphasis and focus of the analysis should be whether someone
satisfies the “economic realities” test.
The economic realities test looks at a variety of factors, including:
Is the work an essential part of the employer’s business?
Does the work require special skill and initiative?
Is the relationship between the worker and the employer permanent or indefinite?
What is the degree and nature of the employer’s control?
The DOL further reasoned that the combination of this test, along the broad
definition of the word “employ,” means that most workers are
employees under the FLSA. This is good news for the many workers seeking
greater benefits. For more information or if you have any questions concerning
your classification, please contact the experienced Georgia overtime lawyers at
The Buckley Law Firm, LLC for an immediate