The Importance of Proper Employment Classification
The issuance of the recent proposed amendments to the Fair Labor Standards Act (FLSA), affecting the circumstances under which someone may be considered “exempt” vs. “non-exempt” and when a worker may be entitled to overtime pay, underscores the importance of correct worker classification.
In fact, how you are classified can have a significant impact, affecting your take-home pay, the benefits you are entitled to, and the workplace protections you receive. For example, if you are classified as an independent contractor, you will not be entitled to any overtime pay.
To determine whether a worker is an independent contractor or an employee, the new standards now evaluate “whether the worker is economically dependent on the employer or truly in business for themselves.”
Additionally, in most circumstances, independent contractors are not entitled to receive employment benefits, and they lack many of the protections set forth in anti-discrimination laws.
Another key determination is figuring out whether a worker is exempt or non-exempt. If a worker is considered exempt, they will not be entitled to overtime pay regardless of how much time they spend working. Alternatively, if you are considered non-exempt, you may be able to earn overtime pay at a rate of one and a half times your standard rate of pay for all time worked in excess of 40 hours in any workweek. However, due to the potential over-inclusion of many workers as “exempt” that legislators never intended to deny paying overtime compensation, the Department of Labor (DOL) has proposed an increased salary threshold that workers must meet to be considered exempt (up from $455/hour). Otherwise, an employee will be entitled to earn time and a half for hours worked above 40.
For more information or if you have questions concerning your classification, please contact the experienced Atlanta wage and hour lawyers at Buckley Bala Wilson Mew LLP for an immediate case evaluation.