Redstone Government Consulting Blog | Jamie Brabston

On January 10, 2024, the U.S. Department of Labor (DOL) published its highly anticipated “final rule” on independent contractor classifications.[1] As expected, they adopted the “totality of the circumstances” test which means that many more workers will be found to be w-2 employees as opposed to 1099 independent contractors. This rule takes effect on March 11, 2024, and is anticipated to have a significant impact across many industries that rely on contract workers, including government contractors. Under the new rule, many independent contractors will likely be reclassified as employees, which will financially impact employers by way of potential entitlement to company benefits, additional tax implications, and possible exposure to employment-based lawsuits, etc. Furthermore, if a worker is misclassified as an independent contractor but is later determined to be your employee, there is an additional risk of back wages that could be assessed for unpaid overtime, particularly in light of the changes DOL has in store regarding the salary basis for exempt employees. Those proposed changes will be discussed at the end of this article.

In late 2008, the Final Rule on Contractor Code of Business Ethics and Conduct (“CoBEC”) was added to FAR Part 3 (Improper Business Practices and Personal Conflicts of Interest) in response to the heightened focus on increased lapses in corporate ethical behavior. FAR Subpart 3.10 sets forth guidance for all contractors with regard to enhanced ethical and compliance standards and requires the insertion of the clause at FAR 52.203-13 in solicitations and contracts if the value of such contract is expected to exceed $6 million, and the performance of which is 120 days or longer. DCAA focuses on compliance with FAR 52.203-13 when conducting accounting system audits.

On January 5, 2023, the Federal Trade Commission (FTC) voted 3-1 on proposed regulations that, if upheld, would ban employers from imposing non-competition agreements on their employees. Relying on Section 5 of the FTC Act, the FTC concluded that “non-compete clauses reduce competition in labor markets, suppressing earnings and opportunity even for workers who are not directly subject to a non-compete.” Commissioner Wilson dissented, stating that the FTC lacks the authority to engage in rulemaking, particularly with consequences of this significance. 

Did You Know that Over 60,000 Charges of Workplace Discrimination Were Filed in the Fiscal Year 2021?

When an employer receives an EEOC Charge of Discrimination, they need to take it very seriously and thoughtfully consider how to prepare a response, which is referred to as a Position Statement. Businesses of all sizes need to understand the ramifications of an EEOC Charge, and to establish policies and procedures to respond to charges and to reduce the likelihood of being charged with discrimination, harassment or retaliation. There are a variety of laws enforced by the EEOC, including:

This video and article are the second of a two-part series where we provide an overview of the position of the Department of Labor (DoL) on independent contractor classifications. This series presents a mock audit to give you a first-hand perspective of the types of questions that Department of Labor investigators ask with regard to the all too common issue of whether or not your workers are properly classified under the law. We will provide "red flags" that are often key to the final determination of the Department of Labor and how to address them.

This video and article are the first of a two-part series where we provide an overview of the Department of Labor (DoL) position on independent contractor classifications. This series presents a mock audit to give you a first-hand perspective of the types of questions that DoL investigators ask with regard to the all too common issue of whether or not your workers are properly classified under the law. We will provide "red flags" that are often key to the final determination of Department of Labor, and how to address them.

This video provides a summary of the status of the various COVID-19 vaccine mandates, with a focus on Executive Order 14042. Although this federal contractor vaccine mandate is subject to an injunction, covered contractors still have some COVID-related obligations for maintaining a safe workplace that should not be overlooked. We also discuss the importance of good faith compliance efforts, including clear communications to employees regarding their right to request accommodation for those contractors that have moved forward with their policies on mandating vaccines. We note that since this recording (January 13, 2022), the United States District Court for the Southern District of Texas also blocked the vaccine mandate for Federal workers.

In January of this year (2021), we told you that the United States Department of Labor (DOL) under the Trump administration announced a final rule clarifying the standard for whether a worker is an employee or an independent contractor under the Fair Labor Standards Act (FLSA). This rule reaffirmed the “economic reality” test as the primary factor for determining employee status. The final rule was published in the Federal Register on January 7, 2021 and the Rule was set to have an effective date of March 8, 2021.

On January 6, 2021, the U.S. Department of Labor (DOL) announced its final rule to clarify whether a worker is an employee or an independent contractor under the Fair Labor Standards Act (FLSA). The final rule was published in the Federal Register on January 7, 2021 and the effective date is March 8, 2021. You may read the entire rule here.

For the past 10+ weeks, we have focused on how to work remotely, compensate employees who are unable to work due to COVID-19 related reasons, and how to interpret and implement the new laws applicable to the pandemic, such as the Families First Coronavirus Response Act, the Paycheck Protection Program, and CARES. As many states begin to loosen the “shelter at home/social distancing” guidelines, it is time to consider – how do we return to work safely?