Employees who work more than 40 hours in a workweek are entitled to be paid one and half times their regular hourly rate for each hour over 40. Employers may try to get around this rule by “asking” or requiring their employees to work “off the clock,” by improperly classifying employees as exempt from the overtime law, or by improperly counting their employees as independent contractors. All of these maneuvers are illegal, and employees who are unfairly denied overtime pay are entitled to recover those lost wages along with interest, and additional penalties may be assessed against the employer.
Exemptions and Misclassifications
Several types of employees are exempt from overtime requirements. These include executive, administrative and professional employees; outside sales workers; computer professionals; and certain highly-compensated employees. Outside sales workers (traveling salesmen, door-to-door salesmen) are exempt from overtime requirements if their primary duty is making sales or obtaining orders away from their employer’s place of business.
The most common misclassifications occur when workers are improperly classified as exempt white collar employees or as independent contractors. Workers who are misclassified may be entitled to back wages for the hours they worked over 40 hours a week when they were not paid overtime.
Employees versus Independent Contractors
The overtime requirements only apply to employees and not to independent contractors. However, the employer cannot simply say that the worker is being hired as an independent contractor. The label is irrelevant; it is the level of independence enjoyed by the worker that determines whether the worker is an employee or independent contractor. If the worker works exclusively for the employer, if the worker’s services are an important part of the employer’s business, if the employer controls the worker’s hours of work and place of work, and if the employer pays for the equipment, tools and facilities used, then the worker is most likely an employee and not an independent contractor.
If the employer has control over how the work is done, then the worker is probably an employee. Other questions to consider when evaluating a worker’s independent contractor status include:
- Is the worker engaged in an occupation or business that is distinctly different from the employer?
- Is the work part of the regular business of the employer?
- Does the worker hire his or her own helpers?
- Does the service require a special skill?
- Is the working relationship temporary or permanent? How long will the services be performed?
- Is the worker being paid by the hour or by the job?
If you believe you are being unfairly classified as exempt and made to work more than 40 hours per week without receiving overtime pay, contact Leandros A. Vrionedes P.C. for a free consultation.