A US Department of Labor proposal to toughen its independent contractor rule is generating controversy and a lot of interest. Business groups, unions, advocacy organizations and individuals seized the opportunity to comment on the proposed rule, with more than 55,000 comments received by the deadline.
The rules developed by President Biden’s administration will determine who is an independent contractor and an employee. If the government decides that a business is misclassifying workers as independent contractors, it may face fines and legal action.
On October 11, 2022, the United States Department of Labor (DOL) issued its Notice of Proposed Rulemaking (NPRM) seeking to undo the Trump administration’s 2021 independent contractor regulations and revert to the six-factor economic realities test. While the test factors remain the same (for the most part), the DOL’s NPRM advances interpretations of the various factors that support employment status at every turn.
The Protecting the Right to Organize Act (PRO Act) passed the US House of Representatives for a second time this March. If it’s signed into law, the legislation would eliminate state right-to-work laws, increase the number of workers eligible for collective bargaining and ban mandatory arbitration agreements.
In this video, McDermott partner Ron Holland breaks down the PRO Act’s most significant changes to employment law.
When California’s Dynamex decision rolled out the “ABC test”, it placed the burden on the employer to prove independent contractor (IC) status. In a presentation at the Employment and Employee Benefits Forum in California, McDermott’s lawyers discussed the implications of Dynamex, as it applies to various types of employers as well as those using staffing companies. Additionally, they cover Dynamex’s impact on worker classification and employee benefits plans, particularly under ERISA.
Lastly, they provide best practices that employers can do now to prevent litigation.
The Massachusetts legislature’s recent approval of a comprehensive non-competition reform bill includes significant restrictions for employers seeking to impose non-compete obligations on Massachusetts workers. The Massachusetts Noncompetition Agreement Act will become effective on October 1, 2018, leaving little time for employers to consider what actions to take to protect their business interests.
Ron Holland, Ellen Bronchetti and Kevin Connelly presented on challenges California employers face in light of a stricter definition for independent contractors. They discuss the Dynamex presumption which places the burden on the hiring entity to establish that the worker is an independent contractor who was not intended to be included within the wage order’s coverage.
Recent independent-contractor misclassification guidelines, and proposed changes to the overtime rules by the U.S. Department of Labor, underscore that employers should be reviewing their independent-contractor classifications and wage and hour exempt-employee classifications. But even if an employer has correctly classified its own workforce, it still may be held responsible for a variety of employment liabilities if it is found to be a ‘joint employer’ with another company which has misclassified its workers. This On the Subject provides practical tips for avoiding joint-employer arrangements.
“I would like to start receiving my retirement benefits now, but I would also like to keep working for a bit. Can I do this?” Baby boomers pose this question to their employers on a routine basis.
Unfortunately, there is no stock answer to this common question. The employer response depends on a variety of factors, including the types of retirement benefits payable to the employee and the arrangement under which the employee will continue providing services to the employer.
This article provides employers with a roadmap for analyzing this common employee request.
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