The primary factor in determining whether an individual should be classified as an employee or independent contractor is the degree of control exerted over that person by the company. In general, an individual should be classified as an employee if the company wants to direct or control the manner and means by which the worker carries out the job. Unfortunately, there is no bright-line test to determine how much control invalidates a contractor relationship; government agencies and courts examine the control element from a number of angles.

In the home health industry specifically, several courts have concluded private duty nurses should be classified as employees. A federal court in Tennessee recently awarded misclassified LPNs $2.2 million for overtime back pay and liquidated damages after concluding the company maintained a significant degree of control over the LPNs by setting wages, assigning work, collecting timesheets, and maintaining personnel files. Given the seriousness of the potential penalties, prudent employers should conduct an internal review to ensure compliance with state and federal laws.

About the Authors: Ron Chapman, Jr. and Dallan Flake are attorneys in the Dallas office of Ogletree Deakins, a national law firm specializing in the representation of employers in labor and employment law issues. They can be contacted at , , or 214.987.3800. This article is provided for informational purposes only and does not constitute legal advice. You should not act or rely on any information contained in this article without first seeking the advice of an attorney.