Kgb USA will pay $1.3 million to 14,568 workers across the country it misclassified as independent contractors. The company paid the workers piece rate for each text message they responded to, regardless of how many hours they worked. The workers all did their jobs from home.
Kgb USA is the world’s largest independent provider of directory assistance and enhanced information services. Its headquarters is in Bethlehem.
The U.S. Department of Labor’s Wage and Hour Division investigated and determined that the workers were in fact employees. As a result, they were entitled to minimum wage and overtime.
In addition, the company was responsible for tracking their hours worked. Because it considered the workers independent contractors, it hadn’t.
Kgb USA agreed to change its policies and practices to conform with the Fair Labor Standards Act. It will no longer classify workers as independent contractors unless they meet the law’s definition.
Note: Classifying workers as independent contractors can be a tempting, but unless they are truly independent, any savings can be fool’s gold. Consult your attorney before classifying as an independent contractor any worker who will consistently provide services to your company.