Why Labor Investigations Target Independent Contractors

From RACmonitor, Cara Ludwig, Esq. discsusses the Department of Labor’s focus on misclassification in the healthcare industry. Cara writes:

Today I want to touch on a type of investigation that affects healthcare providers of all types: U.S. Department of Labor investigations, and specifically those that classify workers as independent contractors versus employees.

Why does it matter?

Because now the topic is coming under scrutiny.

The Department of Labor, which has seen an increase in its ability to bring enforcement actions in recent years, has flagged the healthcare industry as a prime target for investigation.

According to the Department of Labor, in the 2022 fiscal year, the agency’s Wage and Hour Division recovered more than $32.5 million in back wages, specifically for workers in healthcare. That’s more than its recovery for workers in agriculture, retail, food services, or business services, and only just barely less than the recovery in the construction industry.

Why has the Department of Labor targeted healthcare facilities for investigations into employee misclassification, sometimes claiming millions of dollars in unpaid overtime?

The issue is that independent contractors are effectively considered self-employed, so they aren’t subject to federal minimum wage and overtime requirements. During COVID-19, we all know there was a huge demand for healthcare workers, and a lot of facilities turned to contract nursing and other contracted positions to provide necessary healthcare during the pandemic. Now, as we are transitioning out of the public health emergency (PHE), healthcare employers should pay close attention to how their workers are classified.

Read the full story at: Why Labor Investigations Target Independent Contractors – RACmonitor

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