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DOL Issues Guidance on Misclassification of Workers

July 15, 2015, 4:00 AM

As part of the Labor Department’s ongoing effort to curb the misclassification of employees as independent contractors, the head of the Wage and Hour Division issued guidance July 15 on application of the Fair Labor Standards Act and the multifactor “economic realities” test.

“Misclassification of employees as independent contractors is found in an increasing number of workplaces” in the U.S. and can deprive employees of “important workplace protections such as the minimum wage, overtime compensation, unemployment insurance, and workers’ compensation,” David Weil said in Administrator’s Interpretation No. 2015-1. “Misclassification also results in lower tax revenues for government and an uneven...

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