The U.S. Department of Labor (DOL) Wage and Hour Division and the National Labor Relations Board (NLRB) are continuously taking initiatives to improve each agency’s law enforcement, specifically against employee misclassification. Guided by their standards, the DOL and the NLRB aggressively enforces the Fair Labor Standards Act (FLSA) and the National Labor Relations Act (NLRA) respectively to expand the scope of classifying joint employers while narrowing the scope of categorizing independent contractors.
The flexible work arrangement has become a norm in the post-pandemic time, presenting hurdles among company decision-makers when it comes to employee classification. Misclassifying an employee as an independent contractor can pose legal risks to employers including liability claims related to employment taxes, interest, and penalties.
As the COVID-19 pandemic continues to impact workplace situations in the U.S., the Equal Employment Opportunity Commission (EEOC) recently released guidance to clarify employers’ growing concern on the application of Americans with Disabilities Act (ADA) and other EEOC laws.