Fair Labor Standards Act Employer

As attorneys in Houston, Texas, we are sometimes asked about whether individuals are considered employees under the Fair Labor Standards Act.  In making their determination, courts will look to the facts and the “economic realities” of the situation, rather than denying an alleged employee’s claim because of the person’s title as an “independent contractor”     The major factors a court will look at to determine the status of the employment relationship are: (1) degree of control exercised by alleged employer; (2) the extent of the relative investments of the worker and the alleged employer; (3) the degree to which the worker’s opportunity for profit or loss is determined by the alleged employer; (4) the skill and initiative required in performing the job; (5) permanency of the relationship.  Some other factors the court may consider are: (1) whether alleged employer had the power to hire and fire employees; (2) whether alleged employer supervised and controlled employee work schedules or conditions of employment; (3) whether alleged employer determined the rate and method of payment; and (4) whether alleged employer maintained employee records.  Also, under the Fair Labor Standards Act, it is possible for an entity to be a “joint employer” which means that an employer can be the employer of an employee, along with another entity.  In other words, an employee can have more than one employer.

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