Hiring Entity:  When are gig workers employees?

Four Government Agencies & Courts:  It depends!

Trying to track the employment status of gig workers will make your head spin. Contractors? Employees? Super heroes?

In the last few weeks, four federal and California state agencies and courts — the US Department of Labor, the National Labor Relations Board, the Ninth Circuit Court of Appeals and the California Labor Commissioner — have all weighed in on the debate. And, the answer is — it depends.

Follow our script below to help make sense of the patchy legal landscape.


Continue Reading

On April 1, the US Department of Labor proposed a new rule seeking to narrow the application of joint employer status under the Fair Labor Standards Act (FLSA). A finding of joint employer status can impose joint and several liability on a business along with the hiring employer for the employee’s wages. By narrowing the test, the proposal brings potential good news to franchise businesses in particular.

The proposal outlines a “four-factor balancing test” for the Department to apply collectively in its assessment of whether a business is a joint employer with another.


Continue Reading

On March 28, 2019, the US Department of Labor announced a proposed rule to clarify that certain types of compensation and benefits can be excluded from an employee’s “regular rate” of pay, which is used to calculate overtime under the FLSA. This announcement follows the DOL’s recent proposal to increase the minimum salary requirements for the FLSA’s white-collar overtime exemptions, continuing the DOL’s efforts to update and modernize FLSA regulations.

Continue Reading

The Department of Labor’s newly issued opinion letter provides good news for employers who use tipped workers. On November 8th, the DOL reversed its previous “80/20” guidance on use of the tip credit. The tip credit permits employers to pay employees in tip-based positions, such as bartenders and waiters, a lower hourly wage than the federally mandated minimum wage (with the thought that earned tips will make up the difference). Under the previous “80/20” rule, employers were barred from paying the lower cash wage to tipped employees who spent more than 20% of their time performing non-tip generating duties such as setting tables or cutting lemons.


Continue Reading

US Secretary of Labor, Alexander Acosta, recently announced the creation of a new office, the Office of Compliance Initiatives. The “OCI” will be tasked with promoting greater knowledge of federal labor laws and regulations through enhanced compliance assistance outreach efforts. The goal of the OCI initiative is to prevent workplace violations.

Continue Reading

As we previously posted, on January 5, 2018, the Department of Labor did away with its previous six-factor test and announced a new “primary beneficiary” test to determine whether interns and students working for “for-profit” employers are entitled to minimum wages and overtime pay under the Fair Labor Standards Act. See our previous post HERE

On January 5, 2018, the Department of Labor did away with its previous six-factor test and announced a new “primary beneficiary” test to determine whether interns and students working for “for-profit” employers are entitled to minimum wages and overtime pay under the Fair Labor Standards Act. Employers are required to pay employees for their work, but in some circumstances, interns may not actually be employees under the FLSA, and therefore, can be unpaid. The DOL stated that the new test “allows increased flexibility to holistically analyze internships on a case-by-case basis.”

The new “primary beneficiary” test looks at whether the intern or the employer is the primary beneficiary of the relationship. Several circuit courts, including the Second and Ninth, have previously favored the “primary beneficiary” test, viewing it as being more up to date and aligned with the underlying purpose of an unpaid internship.


Continue Reading

Starting last summer, employers began preparing to comply with the Obama administration’s revisions to the Fair Labor Standards Act (FLSA) regulations for the executive, administrative, and professional overtime exemptions (“white collar” exemptions). If implemented, the revised overtime rule would dramatically expand the number of workers eligible for overtime pay and would impact most U.S. employers.

U.S. Secretary of Labor Alexander Acosta announced in a June 7, 2017 press release that the U.S. Department of Labor (DOL) has withdrawn two of its recent administrator’s interpretations. One of the administrator’s interpretations, issued in 2015, focused on the misclassification of employees as independent contractors under the Fair Labor Standards Act (FLSA) and indicated