On July 16 the 11th Circuit Court of Appeals handed down a ruling holding that installation technicians working for Knight Enterprises out of Georgia had been misclassified as “independent contractors.” This meant that the installation technicians should have been covered by the wage and hour protections found in the Fair Labor Standards Act. The technicians were entitled to a minimum wage and overtime pay for hours worked over 40 in a work week.
The court explained that to determine if a worker is an employee or an independent contractor one must look at the “economic reality” of the relationship between the alleged employer and employee and “whether that relationship demonstrates dependence.” The court analyzed the relationship between the technicians and Knight using the following six factors: (1) the nature and degree of Knight’s control over the time, manner and method of the technicians’ work; (2) the technicians’ opportunity for profit or loss; (3) the technicians’ investment in equipment, materials or their own employees; (4) whether the technicians’ position required special skill; (5) whether the services provided by the technicians were an integral part of Knight’s business; and (6) whether the relationship was permanent.
The court looked at each factor, but made it clear that no single factor determines the relationship. The court also explained that the list of 6 factors are not the only factors that can be used to determine whether a worker is an independent contractor or an employee. In this case the court acknowledged that the technicians at Knight were highly skilled individuals and invested in their own equipment but the court still believed the other 4 factors weighed strongly in favor of the conclusion that the installation technicians were employees and not independent contractors.
Important to note for both workers and employers is that the regardless of the test used by the court to determine whether a worker is an employee or an independent contractor, laws tend to favor finding a worker to be an employee rather than an independent contractor. Many workers who are currently classified as independent contractors have been misclassified and should in fact be considered employees. These employees are missing out on worker protections that they would otherwise be entitled had they not been misclassified as independent contractors.
If you are currently classified as an independent contractor and you are working more than 40 hours in a week, not being paid minimum wage, or you have been refused time off to take care of a serious health condition, you may be missing out on protections that you would have if you were properly classified as an employee. It might be worth speaking to an attorney to see if you have been misclassified and whether you are being denied protections to which you are entitled by law.
For further reading please see this article from the Macon Telegraph.
If you are in Georgia please call or email Attorney Benjamin Kandy.