Beware poor agreements that compromise contractor status — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Beware poor agreements that compromise contractor status

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in Centerpiece,Employment Law,Human Resources

contractor's agreementCompanies that use independent contractors typically require them to sign a contractor agreement. But a poorly drafted agreement can be the kiss of death if it is anything like the one recently reviewed by the 3rd Circuit Court of Appeals, which covers Pennsylvania employers.

The case involved the nation’s largest commercial cleaning company, Jani-King, which operates on a franchise basis. It requires franchisees to sign company-drafted franchise agreements. Two people who signed those agreements brought a class-action lawsuit alleging they were neither franchisees nor contractors but actually employees under Pennsylvania wage-and-hour laws—and thus were owed unpaid minimum wages and overtime.

The question the appeals court faced was whether the federal district court properly certified the case as a class action. (Williams v. Jani-King of Philadelphia, No. 15-2049, 3rd Cir., 2016)

Degree of direction, control

A three-judge...(register to read more)

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