Lowe’s Settlement Shows Perils of Misclassifying Contractors


As workers stand up for their rights and federal regulations crack down on employment classification practices, the number of corporations facing accountability continues to grow. Just this week Lowe’s joined the ranks of Google, FedEx, and Uber in settling lawsuits over misclassifying its independent contractors.

Lowe’s current and former employees will recover over $10 million in compensation for wages previously unpaid due to being classified as an independent contractor. Like Lowe’s, many oilfield companies treat their employees as independent contractors to avoid paying overtime wages, taxes and other benefits. Many of these practices violate the Fair Labor Standards Act (FLSA). We see this frequently in the oilfield with MWDs, Directional Drillers, Solids Control Operators and Mud Engineers. These individuals often work side by side with W-2 employees, perform the same job, follow the same rules, but are still treated as independent contractors or consultants.

All Companies Must Adhere to FLSA Standards

As seen by the growing number of companies facing multi-million dollar class action lawsuits, the largest corporations are not exempt from employee classification laws. Although it can seem intimidating to take on these giant businesses in court, workers have the right to do so, and settlements such as the Lowe’s result show that obtaining significant compensation is a real possibility.

In addition to lawsuits levied by workers, corporations that violate federal labor regulations could also face staggering fines from the IRS and individual state labor departments. With fines and lawsuits for employee misclassification occurring more frequently, corporations may turn their attention toward appropriately classifying their workers.

No matter how big the company or whether you worked as an individual or part of a business, every worker is entitled to be properly classified and compensated in accordance with the law. If you believe that your rights have been violated and you have been denied overtime pay or other employment benefits due to misclassification as an independent contractor, the attorneys of Fibich, Leebron, Copeland, Briggs & Josephson LLP can review your case and determine what options are available to you.