Economic Realities, Not Corporate Formalities, Govern Independent Contractor Status

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The distinction between independent contractors and employees continues to confound employers.

At issue in Acosta v. Jani-King of Oklahoma (10th Cir. 10/3/18) [pdf] is whether the Department of Labor could continue its FLSA claims on behalf of individuals who provide cleaning services as franchisees of a janitorial company. If the franchisees are independent contractors, then the FLSA does not cover them. If, however, the company misclassified them as independent contractors, then the DOL has something to litigate.

The 10th Circuit held that the DOL’s complaint said enough for the lawsuit to have continued.

“To determine whether an individual is an employee under the FLSA, courts

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