The U.S. Department of Labor (“DOL”) published a final rule (the “Final Rule”) in January of this year, which took effect March 11, 2024, and changed how the DOL analyzes whether a worker is properly classified as an employee or independent contractor under the Fair Labor Standards Act (“FLSA”).
Employers that misclassify individuals as independent contractors may be liable under the FLSA for double the amount of minimum wages and overtime pay owed for time worked in the preceding three years, plus attorneys’ fees. Both employers and executives may face civil and criminal penalties for FLSA violations, which is an area of intense focus by the DOL. So what should companies know when determining how to classify a worker in light of the Final Rule?
