Question: Is this a possible independent contractor 'game changer'?

Question: On Wednesday, July 15, the U.S. Department of Labor issued an interpretative Guidance Memo on the misclassification of employees as independent contractors. Is this memo a game changer, or is this something that has been done frequently before under different names?

Answer: The DOL's new Guidance Memo is potentially a real game changer. It is part of the administration's overall war against independent contractors. One has to always keep in mind that organized labor hates independent contractors. The current administration is very pro-union. This Guidance Memo is doing the bidding of labor unions everywhere.

The message is consistent with the new position on independent contractors adopted by the National Labor Relations Board in a recent case involving Federal Express drivers in Connecticut. The NLRB's decision attempts, by stealth, to impose a single factor test: "Does the publishing company have greater bargaining power than an individual contractor?" That is really stretching the law.

This Guidance Memo tries to stretch the definition of "employee." It also focuses on economic dependence of the individual contractor. Disturbingly, it places very little value on the intention of the parties. It is clear to this writer that the DOL is going to take the position that most individuals are employees – not independent contractors. However, the DOL Guidance Memo is inconsistent with much of current caselaw supporting independent contractor status.

Fortunately, for the newspaper industry, there is an exemption under Section 13(d) of the Fair Labor Standards Act. If an individual is engaged in the delivery of newspapers to the consumer, he/she is exempt from the minimum wage, overtime and child labor provisions of the Act.

Unfortunately, that exemption does not help with other types of contractors. Buckle your seatbelt and get ready for a rocky ride with the DOL's new interpretation on independent contractors for purposes of the FLSA.

Note: Nothing in this SNPA Legal Hotline Q&A should be relied upon as legal advice in any particular matter.

L. Michael Zinser is the founding partner of The Zinser Law Firm in Nashville, Tenn. The firm, which has a heavy concentration of clients in communications media, represents management in the area of labor and employment. Zinser can be reached at (615) 244-9700 or mzinser@zinserlaw.com.

SNPA's free Legal Hotline for members – (844) 804-2016 – is designed to assist newspapers with a broad range of legal issues. Hotline attorneys and CPAs will tackle questions about circulation, independent contractors, labor and employment law, taxes, finances and accounting, employment benefits, open records, libel and privacy, and other issues newspapers encounter.

The attorneys and CPAs who will take calls from SNPA member newspapers are the best in the business:  The Bussian Law Firm PLLC, Fisher & Phillips, Way, Ray, Shelton & Co., P.C. and The Zinser Law Firm.