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84 Geo. Wash. L. Rev. Arguendo 1 (2016)

handle is hein.journals/gwargu84 and id is 1 raw text is: 






             An Unfair Presumption in the

                Fair Labor Standards Act


                          Alexander Kritikos*

    The Obama Administration's Department of Labor has made it a top
priority to find and investigate instances of employee misclassification-
that is, designating a worker as an independent contractor rather than an
employee.1   Proper classification is important because the Fair Labor
Standards Act provides certain protections for employees-but not
independent contractors-such as a minimum wage' and time-and-a-half
overtime pay.3 The Wage and Hour Division of the Department has called
misclassification one of the most serious problems facing affected
workers, employers, and the entire economy.4
    And it's been putting its money where its mouth is by increasing
government-initiated investigations by almost 25% from 2009 to 2014.5
Due to those increased efforts, the Department of Labor has collected
almost 30% more in FLSA-related back wages in 2014 than it collected in
2009.6 The Department has also partnered with the IRS and 26 states to try
to better detect misclassification.'
    While these efforts should be applauded in many cases, not every
instance of misclassification is unreasonable. Federal courts apply a multi-
factored test to determine an employee's status. The Seventh Circuit, for
example, looks to the following six factors:
    (1) the nature and degree of the alleged employer's control as to
    the manner in which the work is to be performed; (2) the alleged
    employee's opportunity for profit or loss depending upon his
    managerial skill; (3) the   alleged employee's investment in


    I Noam Scheiber, As His Term Wanes, Obama Champions Workers' Rights, N.Y.
TIMES, Aug. 31, 2015, http://www.nytimes.com/2015/09/01business/economy/as-his-term-
wanes-obama-restores-workers-rights html?_r-0.
     2 Fair Labor Standards Act (FLSA) § 6(a), 29 U.S.C. § 206(a) (2012).
     1 FLSA § 7(a), 29 U.S.C. § 207(a) (2012).
     4 Misclassification  of Employees as Independent Contractors, DOL.GoV,
http://www.dol.gov/whd/workers/misclassification/ (last visited Nov. 16, 2015).
     5 Working For A Fair Day's Pay, DOL.GoV, http://www.dol.gov/whd/statistics/ (last
visited Nov. 16, 2015) (citing a 23% increase in agency-initiated investigations from FY-
2009 to FY-2014).
     6 Fair    Labor     Standards   Act    Back     Wages,    DOL.Gov,
http://www.dol.gov/whd/statistics/statstables htm#flsa (last visited Nov. 16, 2015).
     7 Misclassification of Employees as Independent Contractors, supra note 4.

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