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Total Articles: 30

Reminder for Seasonal Recreational Facility Employers as Summertime Approaches: Minimum wage, overtime are not always part of equation

With graduation season upon us and temperatures warming up, it is only a matter of time before amusement and theme parks, beaches, and pools see an influx of visitors as families begin their summer vacations. Many of these facilities employ more employees during the summer due to the need for additional help during vacation months, and under the Fair Labor Standards Act (“FLSA”), these employers may be exempt from paying employees minimum wage and overtime if they meet certain requirements to be considered an “amusement or recreational establishment.”

Penn Students Seek Rehearing, DOL Files Brief in OT Rules Appeal

Just a quick update on a couple of our recent stories for you wage and hour litigation junkies:

Seventh Circuit Rejects Student Athletes’ “Pay for Play” Suit

On December 5, 2016, the Seventh Circuit Court of Appeals issued its decision in Berger v. National Collegiate Athletic Association. The case was brought by former University of Pennsylvania (Penn) student athletes, Gillian Berger and Taylor Hennig, who filed suit against Penn, the National Collegiate Athletic Association (NCAA) and more than 120 other NCAA Division I member colleges and universities, claiming that as track and field student athletes, they were “employees” entitled to a minimum wage under the Fair Labor Standards Act (FLSA).

Seventh Circuit Confirms Student-Athletes Not Entitled to Minimum Wage under FLSA

The U.S. Court of Appeals for the Seventh Circuit has affirmed U.S. District Judge William T. Lawrence’s dismissal of the student-athlete litigation against the NCAA and over 120 NCAA Division I member schools alleging that student-athletes are employees who are entitled to a minimum wage under the Fair Labor Standards Act.

DOL's Focus on Franchising Leads to Landmark Agreement With Subway

Subway, the nation's largest fast food franchise, has entered into a voluntary agreement with the US Department of Labor to encourage its 27,000-plus US franchisees to comply with the Fair Labor Standards Act (FLSA) and other federal labor laws.

FLSA Does Not Apply to College Athletes, Federal District Judge Finds

A federal district court in Indiana has dismissed a major Fair Labor Standards Act (FLSA) lawsuit brought by University of Pennsylvania track athletes against the National Collegiate Athletic Association (NCAA) that could have placed more than 100 universities at significant liability risk. The suit had claimed that student athletes meet the criteria for temporary employees of their universities and should be covered under the FLSA.

Congress Reacts to Obama Administration Moves on Joint Employer Liability

The Republican leadership of a congressional oversight committee has started investigating inter-agency communications in response to the Obama Administration’s attempts to hold business franchisors accountable for labor law violations of their franchisees.

DOL Issues Administrative Interpretation Broadening Test for Joint Employment

Earlier this week, the federal Department of Labor issued a new administrator’s interpretation (No. 2016-1) providing “additional guidance” for determining when an employee is considered “jointly employed” by two or more employers for purposes of the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Workers Protection Act (MSPA).

California Federal Court: Cosmetology and Hair Design Students Not “Employees” Entitled to Minimum Wage

Joining decisions from other parts of the country, a California federal judge has held that former cosmetology and “hair design” students were not “employees” under the Fair Labor Standards Act or the wage-and-hour laws of California and Nevada entitled to minimum wage. Benjamin v. B & H Education, Inc., et al., 2015 U.S. Dist. LEXIS 144351 (N.D. Cal. Oct. 16, 2015).

Uber Litigation Continues To Serve As Legal Lightning Rod for “On Demand” Economy

Cases challenging the independent contractor status of certain service providers under the wage-and-hour laws are likely to continue in the near future due to the difficulties in applying the law to complex factual patterns. The Department of Labor recently provided additional guidance for determining contractor status in the form of an Administrator’s Interpretation (and the National Labor Relations Board also weighed in, modifying its view of “joint employment” in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (Aug. 27, 2015)). A recent case involving Uber drivers may be a bellwether. O’Connor, et al. v. Uber Technologies, Inc., N.D. Cal. C-13-3826.

Lawmakers Introduce Worker Misclassification Legislation

Two weeks after the U.S. Department of Labor issued an Administrator's Interpretation cautioning that "most workers are employees," Senators Bob Casey (D-PA) and Al Franken (D-MN) introduced a bill targeting worker misclassification. The Payroll Fraud Prevention Act of 2015 would make a number of amendments to the Fair Labor Standards Act to require employers to delineate employees from non-employee contractors, impose additional employer reporting requirements, and establish new penalties for misclassification violations.

How Broad is Broad? New DOL Guidance Determines "Most Workers Are Employees"

In a move that is expected to have far-reaching consequences for employers, the U.S. Department of Labor issued new guidance on the classification of independent contractors as employees under the Fair Labor Standards Act (FLSA). Dr. David Weil, the DOL Wage and Hour Administrator, issued a July 15, 2015 Administrative Interpretation (the "Interpretation") warning employers that the definition of "employ" is very broad under the FLSA.1 The guidance reads as an argument, complete with references to favorable federal court decisions, which will likely be used to support future DOL enforcement actions.

eLABORate: DOL Says Most Workers are Employees

The Department of Labor has just issued a new Administrator’s Interpretation to clarify its interpretation of “employee” under the Fair Labor Standards Act. Administrator’s Interpretation 2015-1 is the latest development in the DOL’s ongoing focus on workers misclassified as independent contractors (its “Misclassification Initiative”).

DOL Interpretation Says "Most Workers are Employees" Under the FLSA's Broad Definitions

Executive Summary: Today, the Wage and Hour Division of the U.S. Department of Labor (DOL) issued an interpretation in furtherance of its Misclassification Initiative, which concludes that "most workers are employees under the FLSA's broad definitions." See Administrator's Interpretation 2015-1: The Application of the Fair Labor Standards Act's "Suffer or Permit" Standard in the Identification of Employees Who Are Misclassified as Independent Contractors. The Interpretation does not change the "economic realities" test courts currently apply in determining whether a worker is an independent contractor. It does, however, emphasize that each factor of the economic realities test must be applied consistently with the broad definition of "employ" found in the Fair Labor Standards Act (FLSA); that is, whether the worker is economically dependent on the employer and is, therefore, "suffered or permitted to work" by the employer.

DOL's New Interpretive Guidance Shines Spotlight on Independent Contractor Misclassification

On July 15, 2015 the U.S. Department of Labor issued an Administrator's Interpretation highlighting the DOL's position that many workers are misclassified as independent contractors. The Interpretation sets forth the DOL's view of how to determine if a worker is an employee or an independent contractor. In the DOL's view, the vast majority of workers should be treated as employees, and independent contractor status is limited to individuals who are truly in business for themselves.

DOL Outlines New “Economic Dependence” Test for Independent Contractors

The DOL continues to deliver on the promise of its busy summer. Today, Department of Labor Wage and Hour Division (WHD) Administrator Dr. David Weil announced a new, 15-page Administrator’s Interpretation in a DOL blog post that stressed the FLSA’s expansive definition of employment and reinforced the WHD’s position that most workers qualify as employees under the FLSA, not independent contractors. Although its impact on litigation remains to be seen, the DOL clearly outlines its position that:

DOL guidance on independent contractor classification provides another arrow in the Department’s enforcement quiver.

The Administrator of the US Department of Labor’s (DOL) Wage & Hour Division, David Weil, has issued a formal Interpretation on the subject of “The Application of the Fair Labor Standards Act’s ‘Suffer or Permit’ Standard in the Identification of Employees Who Are Misclassified as Independent Contractors,” the DOL’s first on the issue since President Obama took office in 2008. Administrator’s Interpretation No. 2015-1, July 15, 2015.

USDOL Publishes "Independent Contractor" Interpretation

The U.S. Labor Department's Wage and Hour Division has released "Administrator's Interpretation No. 2015-1" to address what it characterizes as the "problematic trend" of allegedly misclassifying workers as independent contractors rather than as employees for purposes of the federal Fair Labor Standards Act. This development was of course anticipated in light of last month's remarks by the Division's Administrator, Dr. David Weil. In explaining why the agency concluded that such guidance is needed, the Interpretation enumerates a now-familiar list of the consequences resulting from "misclassification" where the FLSA is concerned, including a failure to pay non-exempt employees at least the FLSA-required minimum wage and/or overtime compensation due for all hours worked in a workweek. The Interpretation's asserted aim is to curtail the perceived misclassification phenomenon by clarifying how the standard for determining whether an individual is an FLSA "employee" can help the "regulated community" classify workers correctly.

DOL Outlines New "Economic Dependence" Test for Independent Contractors

The DOL continues to deliver on the promise of its busy summer. This morning, Department of Labor Wage and Hour Division (WHD) Administrator Dr. David Weil announced a new, 15-page Administrator’s Interpretation in a DOL blog post that stressed the FLSA’s expansive definition of employment and reinforced the WHD’s position that most workers qualify as employees under the FLSA. In the run-up to the release of the proposed Fair Labor Standards Act (FLSA) regulations, Dr. Weil announced in a speech at NYU’s law school that his office would soon issue guidance that would “clarify” who qualifies as an independent contractor under the FLSA by providing a “very clear set of criteria.” Although its impact on litigation remains to be seen, the DOL does clearly outline its position that:

USDOL Issues Administrative Interpretation Reflecting Administration’s View Of “Independent Contractor” Analysis Under FLSA

As previously promised, the Department of Labor today issued its eighth Administrator’s Interpretation (“AI”) since the 2010 implementation of this form of guidance. Today’s Interpretation, as expected, reflects the current Department’s position that the governing analysis is the economic realities test which, in the Department’s view, is used to determine “whether the worker is economically dependent on the employer” rather than the full “economic realities” of the parties’ arrangement. Unsurprisingly, under this analysis the Department expresses its view that “most workers are employees under the FLSA.” DOL Administrator’s Interpretation No. 2015-1 (July 15, 2015). This view is consistent with the position expressed by DOL at the agency level in its investigations. The balance of the fifteen-page AI discusses the factors that should be used in applying the “economic realities” test and provides examples of workers who satisfy and fail to satisfy each factor, collecting case law finding workers to be employees under the FLSA.

Most Workers Are Employees, Not Independent Contractors, Says DOL

The US Department of Labor (DOL) today issued a new "administrator's interpretation" intended to help employers figure out whether to treat workers as employees or independent contractors under the Fair Labor Standards Act (FLSA).

Misclassification of Dancers Results in $10.8 Million-Plus Award

Employers across the country are increasingly utilizing independent contractors to fill an ever-expanding array of positions. These jobs range from sophisticated, high-tech engineers and logistics professionals to doctors, nurses, construction workers, and food service providers. But employers who seek to classify workers as independent contractors to avoid the expenditures associated with payroll, taxes, benefits, and capital improvements, or feel further incentivized to do so by the Affordable Care Act, should take note: Courts are sending a clear message that such practices can be costly.

Employee’s Job Responsibilities Must Be Reviewed to Determine Employee’s Status as Executive Under the FLSA

Ramos v. Baldor Specialty Foods, Inc., No. 11-cv-216 (2d Cir. July 12, 2012): The plaintiffs, a group of warehouse “captains” employed during the night shift in the warehouse department of a wholesale food distributor, claimed that the company failed to pay them overtime wages in violation of the Fair Labor Standards Act (FLSA) because they had been misclassified as executives. The plaintiffs specifically alleged that their unit’s job duties were identical in nature to other groups within the company and thus prevented their unit from meeting the Department of Labor’s executive exception requirement. In rejecting the plaintiffs’ claims, the Second Circuit emphasized that the FLSA’s executive exemption does not impose “any such uniqueness requirement for customarily recognized departments or subdivisions” and that other courts “have acknowledged that work shifts can constitute customarily recognized departments or subdivisions.” The Second Circuit went on to list all of the executive-style job responsibilities of the plaintiffs, including but not limited to: overseeing the work of a team of three to six pickers (employees who retrieve food products from the warehouse); assigning different types of work to pickers; improving team performance and efficiency over time; and preparing individual picker production reports. In affirming summary judgment in favor of the defendant, the court held that even though the plaintiffs did not have offices or chairs, the totality of facts “clearly establish that each team is a customarily recognized subdivision with a continuing status and function,” and that “[w]hether all of the warehouse teams ‘perform the same responsibility and thus are interchangeable,’ as the plaintiffs assert, is ultimately immaterial.”

Employer Fleeced By Naked Dancers

Perhaps only two types of people could walk into an adult-entertainment establishment and ask "I wonder if these dancers are properly paid in accordance with the Fair Labor Standards Act?" The first would be plaintiffs' attorneys. The second would be agents from the Department of Labor.

Government Cracks Down on Employee Misclassification

Since the economic downturn, the proper classification of workers has become a hot-button issue. As enforcement agencies step up efforts to curb misclassifications, it is more important than ever for employers to understand how to properly categorize workers.

Education Labor Letter: "I'll Do It for Free!"

Many people are moved to volunteer their time to schools for religious, humanitarian, charitable, or other public-service reasons. No one wants to discourage these impulses, of course, but a school must be careful not to set itself up for a dispute over whether such a person is actually an employee for purposes of the federal Fair Labor Standards Act (FLSA). Being wrong about this could result in substantial exposure for things like minimum-wage and overtime payments, penalties for child-labor violations, and other liability.

Labor Board’s Rulings Trump All Other Laws (Almost).

The National Labor Relations Act (NLRA) protects employees' "concerted activities" which, generally speaking, are any actions by employees undertaken as a group with respect to wages, hours and working conditions – whether or not in a formal "union" context. What happens when these NLRA protections conflict with an employer's compliance with other workplace laws?

‘Tis The Season To Volunteer -- Maybe.

The holiday spirit moves many to volunteer their time for activities of a humanitarian, religious, charitable, or other public-service nature. No one wants to discourage these laudable impulses, but an organization must be careful not to entangle itself in unforeseen disputes over whether these individuals are really "employees" for wage-hour purposes. Getting this wrong could expose you to substantial potential liability for things like minimum-wage and overtime payments, penalties for child-labor violations, and so forth.

The Wage/Hour Cocktail: One Part Work, One Part Love, Mix Well (Tastes Awful).

But as often happens, the relationship went South and Hirsch began seeing someone else. Steelman then sued, seeking lost wages and damages under the Fair Labor Standards Act.

The Wage/Hour Cocktail: One Part Work, One Part Love, Mix Well

You may think that you're working with a "partner", until things head south: your former associate may make an FLSA claim for unpaid wages.
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