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January 26, 2015
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January 5, 2015 – Forms
Both employers and employees should be aware of the recent decisions by federal and state courts finding that Fed Ex drivers were misclassified by Fed Ex as independent contractors, instead of employees. The courts reached their decision by concentrating on whether the employer had the right to exercise control over the manner and means of the drivers’ duties and, whether the employer did in fact exercise such control. The courts deciding on these cases, from the state of California to the DC Circuit Court, all agreed that Fed Ex misclassified the drivers and, accordingly, Fed Ex would be liable for several million dollars in damages as a result of its failure to pay back wages, overtime and, in some cases, the minimum wage to the employees. Fed Ex will also be liable for damages resulting from its failure to properly pay taxes on these employees to the IRS and by failing to provide unemployment insurance to applicable employees.
Despite the fact that these cases have been brought in many different states, as well as in both federal and state courts, the criteria considered by the tribunals for establishing whether a worker is an employee or an independent contractor is generally the same. While each case is different, courts will examine the degree of control the employer had over the worker as well as:
• Whether the worker uses his own tools or supplies or those of the employer
• Whether the worker can realize any profit or loss from his work
• Whether a written contract exists and, if so, what does it say?
• Whether the worker is entitled to any employee-type benefits such as paid vacation leave or a pension plan
• The permanency of the relationship between the worker and the employee
• The degree of independent business organization or operation of the worker
• The amount of initiative and judgment required for the success of the worker
While many of these recent decisions have involved drivers at Fed Ex locations, other cases have involved tech start-up companies in California, umpires providing services at the US Open, newspaper carriers and hardware delivery drivers. This sudden avalanche of cases, in all areas of the country and in all types of businesses, operates as a wake up call to all companies currently utilizing individual contractors in their line of work. With the government investigating claims of misclassification and the courts finding overwhelmingly against the employers in these situations, businesses need to make sure their independent contractors meet the criteria for independent status or the business will face potential liability and damages resulting from the misclassification.
What to Do
If you are an employer in Tennessee and have questions regarding how to classify your workers to avoid the serious tax and legal consequences of misclassification, give the Law Offices of Jill Jensen Thrash a call and we can help you out. Likewise, if you are an employee and believe that you have been improperly classified as an independent contractor, we would also be happy to review your situation and answer any questions you might have. Our goal is to assist our clients in identifying and avoiding potential legal land mines, as well as making sure that you receive all proper compensation owed to you. We are here to help – no matter what side of the desk you are on.
With the prevalence of social media and the potential embarrassing or unprofessional revelations that come with its use, the law has evolved to address the issues of a worker’s right (if any) to keep personal information private from their employer. In keeping with these times, Tennessee has recently passed into law the Employee Online Privacy Act of 2014. Both employers and employees should be aware of this Act since it directly addresses an employer’s right to access an employee’s social media or personal Internet accounts in the workplace. In short the Act prohibits an employer from:
- Requesting or requiring an applicant or employee to reveal their social media or other Internet passwords
- Requesting or requiring an employee to “friend” or otherwise make the employer a contact on social media or personal Internet accounts
- Requesting or requiring an employee to allow the employer to “shoulder surf,” or stand behind the employee and direct or observe the employee while the employee accesses his or her personal accounts.
However, the Act does not prohibit an employer from restricting an employee’s access to websites or Internet accounts while using the employer’s equipment or devices. Similarly, the Act does not prohibit an employer from disciplining or even firing an employee from transferring confidential employer information to the employee’s personal accounts. An employer is also allowed to request a password for equipment owned or provided by the employer and monitor, block or access data stored on a device owned or provided by the employer.
Additionally and significantly, the Act allows an employer to require access to content or information stored on a personal Internet account when the employer has specific information that such content relates to the subject of a workplace investigation. This would appear to come into play when a discrimination claim or other unlawful activity is being investigated and the employer has good reason to believe information about the unlawful act is contained in an employee’s personal Internet account.
This Act goes into effect on January 1, 2015. Violations of the Act will be pursued by the Attorney General and will result in a penalty on the employer of $1000 per violation.
If you are an employer and believe that you have need to access an applicant’s or employee’s personal Internet accounts, proceed with caution. Before taking any action, you are best served by consulting an experienced employment law attorney before making a costly error. An attorney can help determine whether there may be an exception to the Act that could apply to your situation.
If you are an employee, remember that come the beginning of the year, you will almost assuredly not have to supply passwords or other access to your personal Internet accounts to potential or current employers and, crucially, you cannot be penalized by the employer for failing to do so. If you are pressured to do so anyway, stop and consult an attorney. We can help provide necessary advice and assistance to protect your rights.
As always, the Law Offices of Jill Jensen Thrash in Chattanooga, Tennessee is here to help. If you have any questions about how this Act will affect you or your business please give us a call. We are experienced in handling employment law issues of all kinds and are here to serve you.
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