The Connecticut Law Tribune this morning has word of a lawsuit by a group of individuals who say that as vacuum sellers, they were “hosed” by a company that, they claim, was actually their employer. Because the case has just been filed, the employer has not yet filed a response.
The case is likely to turn on misclassification issues – issues that I’ve talked about time and again here. Indeed, this case only emphasizes the need for companies to review their practices when it comes to using independent contractors.
As one of my partners, Joshua A. Hawks-Ladds, commented in the article, “whether or not the workers are considered independent contractors or employees of Kirby may ultimately determine the outcome.”
“We’re seeing more and more class actions and more allegations of workers who are treated as individual contractors [instead of employees],” said Hawks-Ladds. “Or the Department of Labor brings a claim on their behalf, alleging they are not truly individual contractors.”
These “misclassification lawsuits” have become more prevalent since the federal government announced a crackdown on employers who hire people as employees but call them independent contractors. The government, he said, misses out on tax payments and other revenues when workers aren’t deemed to be employees.
Hawks-Ladds said one deciding factor is that independent contractors set their own work schedules and make other judgment calls, while a true employee’s work schedule and responsibilities are controlled by the employer.
He also said there is also a chance the defendants will cite an exemption to the wage and hour laws for outside salesmen, who typically go door-to-door.
It is easy, in day-to-day affairs, to ignore this issue. Time will tell whether another misclassification lawsuit will send the message to employers that this is one area of the law that shouldn’t be ignored.