Everybody has an opinion, so why not share?
This week, Labor Secretary Alex Acosta announced that the WHD will resume its prior practice of issuing opinion letters to advise on difficult wage and hour issues. This is good news for companies and employees because it increases predictability.
An opinion letter is an official, written opinion by the WHD of how a particular law applies to a specific set of circumstances presented by an employer or employee. The benefit to the general public is that opinion letters are published and may be relied upon.
The practice of issuing opinion letters had persisted for more than 70 years before being discontinued in 2010, when the WHD began issuing occassional general guidance memos instead.
The return of the opinion letter means more predictability and less “Gotcha!”
If the proper public role of the DOL is to promote voluntary compliance (as it should be!) and not merely to sack wrongdoers, then this announcement is a big step in the right direction.
This announcement comes shortly after Secretary Acosta’s recent decision to withdraw the WHD’s 2015 and 2016 general guidance memos on independent contractor misclassification and joint employment. Presumably, these would be topics that are now ripe for new opinion letters.
With a new Labor Secretary, employers can expect a shift toward more business-friendly interpretations that respect the existence of independent contractor relationships and decrease the incidence of joint employment findings. As discussed here, the determination of Independent Contractor vs. Employee under the wage and hour laws (e.g., the Fair Labor Standards Act) is made using an Economic Realities Test.
©Todd Lebowitz, posted on WhoIsMyEmployee.com, Exploring Issues of Independent Contractor Misclassification and Joint Employment.