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Teresa R. Tracy Quoted in Law360 Regarding the Department of Labor's Worker Misclassification Guidance

July 17, 2015

Teresa R. Tracy was quoted in Law360 regarding the significance of the Department of Labor's issued guidance on how to determine whether a worker is an independent contractor or an employee under the Fair Labor Standards Act.  The misclassification guidance says most workers qualify as "employees" under the FLSA's expansive definitions.  Ms. Tracy responded with the following opinion:

"This Interpretation is likely to trigger a host of individual, class and representative actions by workers – not only those who are intentionally misclassified by employers seeking to reduce labor costs, but also by workers who were initially pleased with the advantages of independent contractor status but who have become  disenchanted with the vagaries of being in business for oneself.  

Employers should take a close look at workers who are classified as independent contractors and balance the risk of continuing that classification with the possibility of expensive litigation and related back pay, tax and other payroll-driven obligations, penalties, and attorneys’ fees."

The article including Ms. Tracy's quote was published in four Law360 daily sections of coverage, which are sent out to 100,000 daily recipients.  Half of the recipients are corporate counsel.