As we’ve informed you in previous newsletters, the DOL has received significant funding for investigating employers who misclassify workers as independent contractors or as exempt from the overtime provisions of the Fair Labor Standards Act. A DOL news release issued April 22, 2010, indicated that the DOL has requested $12 million for this initiative in 2011 alone, and that the department is working closely on these initiatives with the Vice President’s Middle Class Task Force. In the news release, Secretary of Labor Hilda Solis vowed to “help middle-class families remain in the middle class.”
Just before this, in March 2010, the DOL announced its intent to stop a longstanding practice of issuing fact-specific opinion letters to employers. For nearly a decade, employers with questions regarding federal wage and hour laws could seek the department’s opinion on whether they were in compliance, which could serve as evidence of an employer’s good faith efforts if they were sued. Now, however, the DOL will only issue opinions that “set forth a general interpretation of the law and regulations, applicable across-the-board to all those affected by the provision at issue.
The DOL contends that this will be a much more efficient and productive use of resources than attempting to provide definitive opinion letters in response to fact-specific requests submitted by individuals and organizations, where a slight difference in the facts could change the outcome.” This position is set forth on the DOL Web site at www.dol.gov/whd/opinion/opinion.htm. Of course, the net effect of this shift away from fact-specific opinion letters is even less guidance for employers than before.
The department made this announcement about the same time that it issued an opinion letter finding mortgage loan officers non-exempt (despite employers’ arguments that they were white-collar administrative employees in accordance with a prior DOL opinion letter issued during the Bush administration, which found such employees exempt).
Also, in May 2010, Secretary Solis signed a Workers Rights Joint Declaration along with Ambassador Sarukhan of Mexico, committing to “inform Mexican workers in the United States about their labor rights through information sharing, outreach, education, training, and exchange of best practices.” This declaration will clearly lead to more complaints, investigations, penalties, and the use of employer resources.
Lesson: Collectively, these actions amply demonstrate that the current DOL is preparing (if it has not already begun) to get tough on employers. Consequently, you should redouble your efforts to classify workers properly and make sure that your pay practices comply fully with the law. Article courtesy of Work law® Network firm Pilchak Cohen & Tice (www.mi-worklaw.com).