From JDSupra, Fanny Ferdman discusses a recent lawsuit in which spa and wellness workers alleged they were misclassified as independent contractors. Fanny writes:
Key Takeaways
- Independent contractor classifications for spa and wellness workers face increased scrutiny, particularly where employers exercise significant control over schedules, work location and job duties.
- Operational requirements matter. Requiring contractors to work set shifts, stay on-site during downtime, or perform administrative and support tasks may undermine independent contractor status.
- Hospitality employers should proactively review contractor arrangements for spa, salon, fitness and wellness personnel to identify and address potential wage and hour misclassification risks.
A recent lawsuit involving a resort in Hawaii serves as a timely reminder for hospitality employers that the classification of spa, salon and other personnel as independent contractors can present significant wage and hour risks.
The litigation was brought by massage therapists, estheticians, nail technicians, hair stylists and other spa workers who alleged they were improperly classified as independent contractors rather than employees. According to the allegations, workers were required to work scheduled shifts, remain on-site during assigned hours even when they had no clients, and perform various operational tasks for the resort, including cleaning, laundry, inventory management and retail store staffing.
Although the case remains pending and no court has determined whether the workers were properly classified, the federal district court has denied efforts to dismiss significant portions of the workers’ claims. The litigation therefore serves as a reminder of the scrutiny that may be applied to independent contractor arrangements in the hospitality and wellness industries.
Why This Matters
Although worker-classification tests vary by jurisdiction, many focus heavily on the degree of control exercised by the business. Facts such as requiring workers to maintain employer-set schedules, remain on premises during downtime, perform non-client-facing operational duties and integrate their services into the employer’s business operations may create challenges in supporting independent contractor status.
Hospitality employers utilizing spa personnel, salon workers, fitness instructors, wellness providers or similar service professionals as independent contractors should consider reviewing their current arrangements, particularly where workers:
- Are required to work specific shifts or minimum hours.
- Must remain on-site when not serving clients.
- Perform operational or administrative duties for the business.
- Are economically dependent on a single facility or resort.
- Have limited discretion over how, when and where services are performed.
Key Takeaway
The allegations in this particular litigation underscore the importance of ensuring that actual day-to-day working relationships align with independent contractor classifications. Hospitality employers operating spas, salons, wellness centers or similar guest services offerings should periodically review those arrangements with counsel to assess classification risks under applicable federal and state laws.