Posted on August 3, 2015

Most workers who are currently treated as independent contractors are actually employees under the Fair Labor Standards Act (“FLSA”), according to a new Interpretive Memorandum issued by the U.S. Department of Labor (“DOL”) on July 15, 2015. The Memorandum indicates that independent contractor status should be determined based on whether the individual is “economically dependent” on the employer (in which case the worker is likely an employee), or truly in business for him or herself (in which case he or she is likely an independent contractor). This is a shift from earlier interpretations of the FLSA that focused more on whether the employer or the worker controlled the manner and means of work. Nonprofit employers who use independent contractors need to re-evaluate the status of these workers in light of this new guidance from the DOL.

The following article provides additional information about the new test announced by the DOL to determine if an individual is an employee or an independent contractor.

To view the article, please click here.

PBPA clients should contact us if they have any questions about the status of independent contractors who work with the organization.