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Texas Employers Failing to Pay Overtime to Misclassified Workers

Misclassifying workers as independent contractors is an ongoing problem in Texas. Workers who have been misclassified as independent contractors are not receiving the benefits and legal protections afforded to employees.

The right to overtime pay is one of those protections.

Many people are just not aware that they should be classified as employees. In fact, a few years ago, a report called "Build a Better Texas" showed that more than 40 percent of construction workers had been misclassified as independent contractors, victimized by payroll fraud or paid off the books in cash.

Generally, employees are entitled to an overtime pay rate of one-and-a-half times the regular rate for every hour worked over 40 in a week. However, independent contractors may not be entitled to overtime pay -- unless they bring a successful wage claim showing that they were misclassified.

So how do you know if you were misclassified as an independent contractor?

The Texas Workforce Commission provides some helpful criteria for when a worker should be classified as an employee.

For example, if a person continues to work for an employer month after month or year after year, the worker is typically regarded as an employee and not as an independent contractor. Typically, an independent contractor is hired to do a single job and does not have an expectation of continuing to work for the employer after the job is done.

Here are some other criteria for classifying someone as an employee:

  • An employee's hours are set by the employer, rather than the worker choosing the hours, which is what an independent contractor does.
  • An employee typically receives training from the employer or from another employee, whereas an independent contractor typically doesn't receive training from the employer or another employee.
  • An employee is typically furnished with tools and equipment by the employer, whereas an independent contractor provides his or her own tools and equipment to do the job.
  • An employee's appearance and behavior can be controlled to a degree by the employer, whereas an independent contractor's appearance and behavior are typically not controlled by the employer.

This list of criteria is not exhaustive, and anyone with questions about employment classification should speak with an employment and overtime rights lawyer.

Sturm Law PLLC

At Sturm Law PLLC, we help workers in Houston and throughout Texas get the overtime pay to which they are entitled. We know that many people simply are not aware of their overtime rights, and we encourage workers with questions about these matters to seek answers from an experienced employment law attorney.

Source: "Build a Better Texas," Workers Defense Project, 2013

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