Legal and Compliance News

Question of the Week: We are currently downsizing as part of our company reorganization and are considering redesignating some of our employees as independent contractors. Are there any potential ramifications for making the change?

Answer: It is possible to change a worker’s status from employee to independent contractor provided that the worker meets the legal requirements of an independent contractor. Whether a worker is an employee or independent contractor is determined through a series of legal tests established by state and federal courts and agencies. For example, for federal tax purposes the IRS uses common law rules to determine whether a worker is an independent contractor. The common law rules examine various facts regarding the degree of direction and control the employer has over the worker and the amount of independence the worker has in regards to performing the work. The more direction and control an employer exerts over the worker, the more likely the worker is an employee. Conversely, the more independent the worker is, the more likely the worker is an independent contractor. It is important to note that there is no single factor that is determinative. The determination is based upon the totality of the circumstances...

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Federal Contractors to Receive Paid Sick Leave

On September 7, 2015, President Obama issued Executive Order (EO) 13706, which requires federal contractors and subcontractors to provide paid sick leave to their employees. The EO applies to contracts entered into after January 1, 2017 that are procurement contracts for services or construction...

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Many Home Companionship Workers No Longer Exempt

Agencies and other third-party employers of live-in household employees and home companionship providers, take note: the long-delayed regulations reclassifying many of these workers as non-exempt employees entitled to minimum wage and overtime under the FLSA are now in effect.

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Meal Periods with Travel Restrictions May Be Compensable

In Naylor v. Securiguard, Inc., the Fifth Circuit Court of Appeals held that an employer may be required to compensate employees for meal breaks if the employees are required to spend a significant portion of that period traveling to a required break area.

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OSHA Inspecting 40 Percent of Reported Injuries

OSHA’s new reporting requirements began on January 1, 2015. Under these requirements, employers in federal OSHA jurisdiction are required to report to OSHA any work-related fatality or any work-related injury resulting in an employee being formally admitted to the hospital or any work-related amputation or loss of an eye. Since the implementation of these new requirements, OSHA estimates that it is receiving 200 to 250 reported incidents each week.

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