The Department of Labor and IRS crack down on employee vs. contractor designation

On July 15, 2015, The Department of Labor narrowed the definition of “contractor”, which will result in the Department designating more workers as employees as opposed to independent contractors. The classification of a worker as an employee or contractor is determined based upon how integral their work is to the business, the skills required for the work, the permanency of the relationship, and other factors. Misclassifying employees as contractors could result in a costly lawsuit for payment of up to 3 years of back wages and overtime.