DOL Releases Misclassification Guidance

As we previously posted on this blog, federal and state governments, labor and employment agencies, and plaintiff's attorneys have increased their focus on employers who misclassify employees as "independent contractors" in an effort to save costs on minimum wage and overtime requirements. On July 15, 2015, the federal Department of Labor ("DOL") issued formal guidance addressing misclassification of employees as independent contractors under the Fair Labor Standards Act ("FLSA"). The DOL's guidance stresses the FLSA's already expansive definition of "employee," and makes clear that the DOL will consider most workers to be employees under the statute.

The DOL's guidance focuses on the broad scope of the employment relationship under the FLSA. In determining whether workers are employees or independent contractors under the FLSA, courts have applied the "economic realities" test. The main question for this test is "whether a worker is economically dependent on the