Independent contractor sues EOG (formerly Enron) for retirement benefits

drilling for oil

From benefitspro, Nick Thornton reports a lawsuit against EOG Resources, formerly Enron, by an independent contractor claiming that he and others like him were misclassified as independent contractors and are entitled to retirement benefits.  Many companies neglect the risk that an independent contractor may file a misclassification claim against them well after the workers have stopped working for the companies. After they leave, workers may seek overtime, unemployment benefits, or, as in this case, retirement benefits from companies for whom they used to work. Nick reports:

The complaint alleges EOG misclassified the plaintiff and other workers as independent contractors, subsequently denying them overtime pay and access to company-provided retirement and health benefits.

Under the FLSA, employers are required to compensate hourly workers time clocked above 40 hours. Employers are exempt from such requirements in the case of bona fide independent contractors.

Over the years, courts have struggled to define which conditions of an independent contractor’s working relationship would constitute the role of a full-time employee, thereby affording protections in the FLSA and ERISA.

Lawsuits filed under the Fair Labor Standards Act, which have increased every year for the past seven years, have jumped…

If a worker is “economically dependent” on the firm they work for, they are considered an employee, and not a contractor, under the FLSA.

A Department of Labor fact sheet says the Supreme Court has considered several factors in questions pertaining to employee classification, but no single factor is considered to be fully determining of employee classification.

The importance of the work done to the business, the permanency of the relationship, the degree to which the worker’s own equipment is used, the degree of control the employer has over the worker, the opportunity for profit and loss, and whether or not the worker has relationships with other employers are all factors courts have weighed when determining employee status.

Workers can be functioning as full-time employees even when they think they’re contractors, and even if the worker goes so far as to sign a contract saying they’re independent, and write off business expenses.

In the EOG claim, the plaintiff worked as an environmental analyst for nine consecutive years, compensated as a contractor with an hourly wage all the while.

Read the full story at Independent contractor sues EOG for retirement benefits

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