Social welfare and worker protection laws in the United States generally do not protect people based on their status as residents or citizens, nor do the benefits of these laws flow from general tax revenues channeled through the government.  Instead, the protection and benefits exist in most cases only for employees, and the cost is borne partially or totally by their employers.

As a result employers have easily calculable financial reasons to disclaim the employee status of those who perform work that must be done to achieve their business purposes. From the employer’s viewpoint, treating workers as non-employees immediately saves payroll costs ranging from 15 to 30%.  In addition, denying employee status to workers avoids out-of pocket costs, administrative costs, and loss of control that result from the need to pay wages owing to employees, to comply with regulations protecting employees, and to bargain with unions representing a business’s employees.

In addition, various laws confer rights on employees that are not available to independent contractors.  Workers who are employees may be able to file a lawsuit or other legal action against the company that employs them for a failure to pay minimum wage or overtime, discrimination or harassment, or for failing to provide a healthy and safe workplace.  In some cases, the worker will need to prove a joint employer relationship because the subcontractor cannot be located or lacks the financial resources to pay a court judgment.  In other cases, a worker will need to prove she is an employee and not an independent contractor.

To find coverage under labor and employment laws, we look at two considerations: the statutory definitions of employment contained in the law, and the test used by courts to apply those definitions.  The tests often result in different conclusions as to whether a person is covered by the law, depending on the standard used.  Under some standards, such as the Fair Labor Standards Act and the Migrant and Seasonal Worker Protection Act, the laws’ broad standard is more likely to find coverage for workers, while under more restrictive laws, such as the Federal Insurance Contributions Act or the National Labor Relations Act, that same worker is more likely to be found not covered by the law.  

New NELP Webpage: Hurricane Katrina and Low Wage Workers: Fact Sheets for Workers and Advocates

Displaced residents of the Gulf Coast, disaster responders, and workers seeking jobs in the devastated areas face uncertain labor and employment protections thanks to the recent federal rollbacks of such bedrock protections as the right to be paid the prevailing wage on public sector jobs and the right to affirmative action in hiring for those jobs. Employers may feel emboldened by the administration’s undercutting, but workers and their advocates must remind them that other labor and employment laws remain on the books and must be followed. Workers still have the right to be paid, to be free from safety and health hazards, to get leave to take care of sick family members, and to get workers’ compensation benefits if they are injured on the job. NELP has prepared a series of fact sheets and a policy short addressing these issues, which are available on this page.

New NELP Webpage: Raising the Level of Basic Workplace Enforcement

To combat the decline in basic work standards, there is a growing recognition of the need to raise the level of enforcement for workers stuck in sweatshop jobs, including the right to be paid the minimum wage and to receive health and safety protections on the job.  This webpage provides materials and reources for community groups, advocates and allies seeking to shore up basic workplace rights.

Fact Sheets

New:  1099'd: Misclassification of Employees as Independent Contractors.   Because of their status as non-employees, misclassified “independent contractors” miss out on: minimum wage and overtime requirements, workers’ compensation, unemployment insurance, the right to form a union and bargain collectively, and other workplace protections like the right to safe and healthy worksites and to be free from discrimination in employment.  This fact sheet provides strategies for challenging employee misclassification.  (July 2005)

NELP Comments to DOL Regarding Proposed Changes to Overtime Rules
The Bush Administration’s Department of Labor (DOL) is pushing changes to this nation’s overtime laws that would expand the number of workers who are not entitled to overtime pay under the so-called “white-collar” exemptions. NELP and many signatories submitted comments to the DOL today, stating that the proposals rob many low-income workers of much-needed pay for overtime, and permit employers to require workers to work more than 40 hours in a week without paying overtime pay. (June 30, 2003)

Contingent Rights: The Legal Landscape for Nonstandard Workers in California    
California has a large and growing workforce of "nonstandard" workers - those who work as "independent contractors" or whose work is subcontracted out. This publication reviews their treatment under California state law, their campaigns for equal workplace rights, and suggested policy and advocacy areas for California advocates. (May 2003)