Boulder Insurance Update
Misclassification of contractors and employees can be a problem when it comes to Boulder workers’ compensation and employment laws. The Department of Labor (DOL) is cracking down on employers who misclassify independent contractors who really should be employees. If you are an employer who hires contractors, the DOL has issued new guidelines to help you.
The guidance comes right out of the Fair Labor Standards Act where the identification process is explained. One of the big reasons for the enforcement is to offer the protections to employees for minimum wage, overtime, and unemployment compensation. Recently in New York, Uber and Lyft drivers were determined to be contractors, not employees. However, every state will make its own determination. The DOL offers these six factors for employers to use as a test to differentiate between an employee and a sub-contractor.
The six factors or questions in the “economic realities” test include:
Source: DOL-Administrator’s Interpretation No. 2015-1
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