Over the last year, many workers have taken on additional jobs or changed careers. It’s important for workers who are independent contractors and employees to be classified correctly. The Department of Labor (DOL) provides general information about employment relationships under the Fair Labor Standards Act (FLSA).
While there is no single rule or test to determine whether a person is an independent contractor or an employee, an employee is usually dependent on the business he or she serves unlike a person who is engaged in his or her own business.
In making a decision about the relationship, a court may review the extent to which the services provided are an integral part of the business and the permanency of the relationship. It may also look at the degree of independent business organization and operation, the control over the work and the opportunities for profit and loss, among other factors.
The DOL also notes that the lack of a formal employment agreement, information about where the work is performed and the timing of pay generally do not have a bearing on whether there is an employment relationship.
When a relationship is established between an employee and the employer and the worker is doing work covered by the FLSA, the worker must be paid at least minimum wage, must be paid overtime in most cases for all hours worked over 40 per week and the employer has record-keeping requirements.
If a worker believes he or she has been misclassified, an experienced attorney can help pursue wages and provide advice.