From JDSupra, Richard Reibstein reports on the settlement of a class action lawsuit alleging that dental claims reviewers were misclassified as independent contractors. Richard writes:
Dental consultants including dentists and hygienists engaged to evaluate dental insurance claims have reached a proposed $3.4 million settlement of proposed class and collective action alleging wage and hour violations under the Fair Labor Standards Act, the Employee Retirement Income Security Act, and various state labor laws (IL, NJ, NY and RI) due to their alleged misclassification as independent contractors instead of employees. According to the complaint filed in United States District Court for the Southern District of New York against Metropolitan Life Insurance Company, the dental consultants evaluated claims for benefits submitted by policyholders, participants, and beneficiaries in employee benefit plans to determine whether the services rendered were dentally necessary. The consultants alleged that, among other things, they should have been classified as employees and been entitled to overtime compensation because the company allegedly exercised direction and control over them by dictating their maximum hours of work; requiring them to work at MetLife’s offices and record their hours of work on forms issued by MetLife; requiring them to use computer hardware and software that MetLife provided to the consultants at no charge; imposed guidelines as to how to perform the work; trained them and supervised their work through managers; created standards by which to assess the quality and quantity of their performance; and assessed their performance under those standards. Under the terms of the proposed settlement, the eligible class members (approximately 120 dental consultants) would receive no less than $1,000 each; $1,260,000 is earmarked for attorneys’ fees; and $168,000 would be set aside for service awards to particular plaintiffs. The parties’ proposed settlement agreement contains a non-admission provision on the part of the company and there is no requirement that the company change its business practices. The parties await approval of the proposed settlement by the federal district court judge. McNeely v. Metropolitan Life Ins. Co., No. 1:18-cv-00885 (S.D.N.Y. Oct. 7, 2019).
Source: October 2019 Independent Contractor Misclassification and Compliance News Update | Locke Lord LLP – JDSupra