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Employee or Independent Contractor? New Guidance Issued by the Department of Labor

Client Alert

On January 9, 2024, the U.S. Department of Labor (DOL) issued its long-awaited final rule — effective March 11, 2024 — revising its prior interpretation of worker classifications under the federal Fair Labor Standards Act (FLSA).

The new final rule rescinds the standard previously established in 2021, in turn, shifting the analysis of whether a worker is an employee (versus an independent contractor) of a business from a more streamlined “economic reality” test to a more complex “totality of the circumstances” standard.

Understanding and correctly applying this new analysis is critical given the implications of worker misclassification under the FLSA — employees are entitled to minimum wage, overtime pay, and other benefits, whereas independent contractors are not entitled to such benefits but enjoy greater flexibility and independence.

Under the new standard, the following non-exhaustive list of factors will be taken into consideration:

  1. The opportunity for profit or loss a worker might have based on their skillset (i.e., factors that impact a worker’s economic success or failure);
  2. The financial state and nature of any resources (e.g., capital or entrepreneurial) a worker has invested in the work;
  3. Degree of permanence of the work relationship (i.e., whether the work relationship is indefinite versus temporary in nature);
  4. The degree of control an employer has over the person’s work (e.g., who sets the worker’s schedule, who oversees and/or directs performance, and whether the worker can maintain other jobs);
  5. Whether the work the person does is essential (i.e., critical, necessary, or central) to the employer’s business; and
  6. The worker’s skill and initiative, including whether the worker contributes to business-like initiatives.

While the above analysis is, again, limited to worker classifications under the FLSA, it is very likely to have a significant impact going forward as, per the DOL, the final rule is intended to stretch broadly across all industries to “reduce the risk that employees are misclassified as independent contractors while providing a consistent approach for businesses that engage with individuals who are in business for themselves.”

The new final rule, while not controlling law, will inevitably serve as persuasive guidance in federal misclassification cases.

For additional information on the new DOL guidance or how it may impact your company, please reach out to Monica Andress at (330) 253-9153 or, or any member of the Labor and Employment Team of Brennan, Manna & Diamond LLC.

LGBTQIA+ Patients and Discrimination in Healthcare

In early April, the Kaiser Family Foundation released a study outlining the challenges that LGBT adults face in the United States related to healthcare. According to the study, LGBT patients are “twice as likely as non-LGBT adults to report negative experiences while receiving health care in the last three years, including being treated unfairly or with disrespect (33% v. 15%) or having at least one of several other negative experiences with a provider (61% v. 31%), including a provider assuming something about them without asking, suggesting they were personally to blame for a health problem, ignoring a direct request or question, or refusing to prescribe needed pain medication.”

Ohio Recovery Housing Overhaul: New Standards and Certification Requirements Reshape Sober Living Spaces

Ensuring Fair Access: SB 269 Protects Affordable Medication for Low-Income Patients

SB 269, introduced on December 19, 2023, will ensure that 340B covered entities, including Federally Qualified Health Centers, Ryan White Clinics, disproportionate share hospitals, and Title X clinics, can acquire 340B drugs without facing undue restrictions or discriminatory practices from drug manufacturers and distributors. This protection is crucial for 340B covered entities to continue to provide affordable medications and comprehensive services to low-income patients.

Unveiling Ohio's Pharmacy Board Updates for Distributors, Mobile Clinics, and Controlled Substances

The Ohio Board of Pharmacy will hold a public hearing on May 28, 2024, to discuss several proposed changes and additions to Ohio Administrative Code (OAC). These changes pertain to terminal distributors of dangerous drugs (TDDDs), mobile clinics or medication units, and the classification of controlled substances.

House Bill 249: Key Updates to Involuntary Hospitalization Law for Mental Health Providers

House Bill 249 (HB 249) proposes changes to Ohio Revised Code (ORC) Sections 5122.01 and 5122.10 to expand the conditions under which a person with a mental illness can be involuntarily hospitalized.