Category Archives: Misclassification

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Moving Exempt Employees to Non-Exempt Status [Wage & Hour FAQs]

We discuss the misclassification of non-exempt employees regularly here on the blog and in our presentations at conferences and webinars, but a reader of the blog wrote me before the holiday weekend to ask about the reverse situation. The reader’s company has previously determined (correctly, we’ll assume) that some of its employees meet the “computer … Continue Reading

Are You Secretly Running a Construction Business? State Law Says You Might Be!

I promise that this post isn’t a bad setup to a joke about The Sopranos, the mafia, or being in “waste management.” Late last month, I spoke at a regional meeting of the Wireless Internet Service Providers Association, and many of the WISPs in attendance were surprised to learn that not only were they in … Continue Reading

Defense Appropriations "Wage Theft" Amendment May Bar Employers with FLSA Violations from Defense Contracts

Late last month, the Senate referred the Fiscal Year 2015 Defense Appropriations Act to the Senate Committee on Appropriations for consideration. The House of Representatives passed its version (H.R. 4870) on June 20 with substantial bipartisan support, 340-73, after considering 80 different amendments. Since this is a wage and hour blog, you can safely assume … Continue Reading

You Load 16 Tons, What Do You Get: A Worthless Franchise!

Despite the focus in recent years on the misclassification of employees as contractors, unfortunately, we continue to see numerous companies ranging from the Fortune 500 to startups make mistakes, albeit mostly unintentional, with their use of “contractors.” Generally, these mistakes are because of misunderstandings (“We agreed to do it this way.”), myths (“She works two … Continue Reading

Third Circuit Applies More Relaxed Federal Standard to Successors in FLSA Cases

Guest Blogger: Lindsey Marcus The Third Circuit Court of Appeals, which covers Pennsylvania, New Jersey, Delaware, and the U.S. Virgin Islands, recently became the third appellate court to adopt the federal common law standard for successor liability in a Fair Labor Standards Act (FLSA) claim. The decision likely means that successor employers will find it … Continue Reading

DOL's Misclassification Initiative Continues

Iowa is the latest State to sign a Memorandum of Understanding and join forces with the U.S. Department of Labor to combat employee misclassification.  Although Labor Secretary Solis has announced her resignation, it appears that the Misclassification Initiative that she championed continues, at least for now. As mentioned in a previous post, these Memorandums of … Continue Reading

Family Dollar Settles Store Manager Overtime Claim

On September 12, 2012, Family Dollar announced that it will pay up to $14 million to settle a class action in the Southern District of New York.  Similar to other class actions filed against Family Dollar over the years, New York store managers claimed that the Company failed to pay them overtime.  Although the agreement … Continue Reading

Court Rejects Challenge to DOL's Interpretation That Mortgage Loan Officers are Non-exempt

I wanted to give our readers a quick update on the status of mortgage loan officers.  In Mortgage Bankers Ass’n v. Solis, a federal district court in Washington D.C. recently rejected a challenge to the March 2010 DOL administrator’s interpretation that mortgage loan officers do not generally meet the administrative exemption under the FLSA.   As previously … Continue Reading

Recent Settlements Agreeing to Pay Overtime for Misclassification of Employees

Misclassification of employees continues to bring a lot of headaches to employers.   I have worked with a wide variety of businesses on this issue – from Fortune 500 to “mom and pop” companies.  Each has its own way of doing things in this area and monitoring classification compliance is pretty low on the to-do list.  … Continue Reading

Ten Things Small Business Needs To Know About Minimum Wage and Overtime

I read the stories every day: some small business, often a local restaurant or a similar “mom and pop” operation, gets sued or tagged by the Department of Labor for failing to pay minimum wages and overtime to employees. Here’s just one example.  I have worked with a fair number of small and midsize businesses. … Continue Reading

Louisiana Joins the DOL's Misclassification Initiative

Louisiana is the latest State to sign a Memorandum of Understanding and join forces with the U.S. Department of Labor to combat employee misclassification.  These Memorandums of Understanding with state government agencies arose as part of the U.S. Department of Labor’s Misclassification Initiative, with the goal of preventing, detecting and remedying employee misclassification. Louisiana is … Continue Reading

Seventh Circuit Weighs In On Commonality Requirement in Class Actions

The Seventh Circuit recently applied the Supreme Court’s Wal-Mart Stores, Inc. v. Dukes decision to class certification in a wage and hour action, and affirmed the certification of two classes.  Ross v. RBS Citizens N.A. d/b/a Charter One.  The Seventh Circuit held that the district court did not abuse its discretion in certifying two classes … Continue Reading

Court: Cable Installers Employees, Not Independent Contractors

A couple of weeks ago, I wrote about an initiative by the U.S. Department of Labor, IRS and various state agencies to launch a coordinated crack-down on employers who misclassify employees as independent contractors. Recently, a U.S. District Court in Ohio issued a ruling that nicely illustrates the problem of misclassifcation and the potential liabilities … Continue Reading

DOL Coordinates With IRS, States On Independent Contractor Misclassification

Earlier this week, the U.S. Department of Labor held a ceremony at which Secretary of Labor Hilda Solis signed a memorandum of understanding with the Internal Revenue Service to “improve departmental efforts to end the business practice of misclassifying employees in order to avoid providing employment protections.” The DOL also signed or has agreed to … Continue Reading

Webinar: What Do Universities and Colleges Need to Know About Wage & Hour Law?

I’m pleased to announce that on September 28, I will be conducting a webinar with my partner Ed Druck covering some common wage and hour issues encountered in the college and university setting and best practices for complying with the Fair Labor Standards Act and state wage and hour laws. Our program will focus on problems … Continue Reading

Are Pharmaceutical Companies Losing the Exemption Battle?

Recently, another group of pharmaceutical sales representatives successfully demonstrated that they are not exempt from overtime under the FLSA.  Kuzinski, et al., v. Schering Corp  Focusing on the administrative exemption, the District Court of Connecticut held that the sales representatives’ work was not directly related to Schering’s management or general business operations and they lacked … Continue Reading

Security Guards Misclassified As Independent Contractors

On May 24, 2011, a federal district court in Chicago ruled that security guards who were licensed, insured, trained, and paid by the hour by a private security company were not independent contractors, but employees entitled to overtime pay under the Fair Labor Standards Act. Solis v. International Detective & Protective Service, Ltd.  Granting summary … Continue Reading