Speaking at the ABA Labor and Employment Conference in Chicago on November 4, 2010, Deputy Secretary of Labor Seth Harris reiterated the DOL’s commitment to enforcement as shown by its increased staffing. According to Deputy Secretary Harris, the DOL’s Plan, Prevent and Protect Initiative, announced earlier this year, was initiated to target the most egregious violators of the laws enforced by the DOL in its efforts to protect the most vulnerable employees. Deputy Secretary Harris confirmed that there is increased cooperation and information sharing between various federal government agencies and with state agencies, particularly in the area of misclassification of workers as independent contractors rather than as employees.
Deputy Secretary Harris stated that it is the DOL’s position that workers have the right to know the employer’s analysis with respect to classification as non-exempt or exempt from the requirements of the Fair Labor Standards Act or the basis for their treatment as independent contractors. As the DOL has not yet issued regulations, Deputy Secretary Harris could not specify what steps employers must take to comply with this disclosure requirement.
From attending various programs, it is clear that employers are struggling with common issues in terms of overtime pay and that employment attorneys are seeing increasing class actions and collective actions being brought in both federal and state courts. In light of the potential exposure, the general consensus of practitioners was that employers must take remedial actions to correct employee misclassification. However, employers should consult with their attorneys prior to taking corrective actions.