Misclassification

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When people are employees, the deductions that may be made from their wages are limited and many items that would be classified as employer business expenses cannot be deducted from worker pay.  When individuals are independent contractors, these otherwise forbidden deductions may be effected because of this supposed non-employee status.  When those two worlds collide,…

The State of New Jersey (and many other states) has started to tighten up laws regarding independent contractor status. One troubling component (to management-side practitioners and employers alike) of this New Jersey initiative is to compel employers to post a notice that explains elements of independent contractor law and, essentially, invites workers to file suits…

There have been a host of wage hour cases in the energy industry and I have often commented upon these.  Many concern misclassification issues and another example of this phenomenon has arisen where a class of pipeline inspectors has requested that a federal court approve a settlement amounting to more than $2,000,000 where the theory…

I have long been a fan of the fluctuating work week (FWW) method of paying overtime to non-exempt salaried employees.  This computation yields a half-time calculation, i.e. a lower calculation than dividing the salary by forty and then calculating time and one half of that number.  The Pennsylvania Supreme Court has recently held that this…

Many times, plaintiff lawyers will try to file FLSA class actions as nationwide lawsuits so the size of the class and potential recovery can be magnified geometrically.  Well, that just got a little harder to do as a federal judge rejected an attempt by a group of Outback Steakhouse front-of-house managers to continue as a…

The New Jersey DOL is very aggressive on the issue of independent contractor status, i.e. the issue of misclassification.  The latest, perhaps best (or worst) illustration of this view is the agency’s determination that court reporters are employees for purposes of the Unemployment Law.  This errant decision, which cuts against traditional modes of thinking on…

The issue of whether athletic referees are independent contractors has surfaced a few times in the last few years. Here, in Pennsylvania, the Pennsylvania Interscholastic Athletic Association (the PIAA) that engages these referees has agreed to settle with a group of these individuals for $260,000 to close out a FLSA action, based on misclassification. The…

When will employers learn?  They keep classifying retail Store Managers and Assistant Managers as exempt, when these workers are often misclassified, not intentionally, but because the nature of their duties often tends to undermine the primary duty test and render them non-exempt.  Another example is a recent case where Store Managers have been granted conditional…

The retail industry is notoriously prone to FLSA collective action misclassification lawsuits because there are many levels of management, especially so-called lower management, where the employees may/may not discharge actual/true supervisory powers. Another illustration of this principle has resulted in a large dollar settlement that will pay employees known as “sales team managers” a fairly…

When an employer realizes that a certain classification or number of employees has been misclassified as exempt, the employer may do the right thing and, henceforth, treat those people as non-exempt and pay overtime accordingly.  That corrective measure, however, leaves a gap because the workers can sue for overtime for the period preceding the change. …