SHRM Urges Classification of Independent Contractors

For Immediate Release

Jul 25, 2007
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(Alexandria, VA, July 25, 2007)—Society for Human Resource Management (SHRM) member and employment law attorney Christine Walters testified yesterday before the House Education and Labor Committee to stress the need for agency clarification and guidance to assist employers in classifying workers as employees or independent contractors.

"Every new working relationship brings with it the challenge of asking the right questions to ensure the employment situation is being properly classified as an employee or non-employee worker," said Walters. "In my experience, employers do on occasion unwittingly, misclassify employees as independent contractors," she said.

Walter's testimony highlighted a confusing regulatory environment fostered by multiple agency and statutory jurisdiction over the classification of a worker as an independent contractor.

During the hearing, "Misclassification of Workers as Independent Contractors: What Policies and Practices Best Protect Workers?," Walters highlighted a 21 st century workforce landscape of part-time employment, flex-time and telecommuting schedules, leased employees, direct-hire employees, agency temporaries, per diem workers, and independent contractors.

"Joint guidance from the various agencies on the classification of employees would greatly assist employers in complying with the law," she said. "Secondly, increased and targeted education should be combined with increased and targeted enforcement."

The many statutory jurisdictions that cover classification of independent contractors include the Family and Medical Leave Act, the Americans with Disabilities Act, the Internal Revenue Code, the Fair Labor Standards Act, the National Labor Relations Act, and individual state-by-state unemployment insurance codes.

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