On July 13, 2018, the Wage and Hour Division of the Department of Labor (WHD) issued guidance on the subject of whether nurse or caregiver registries were the “employer” of the nurses or caregivers on those registries. This guidance is notable for a several reasons. It recognizes the changing nature of employment. These registries are often online services where a person or group needing caregivers (e.g., home health, babysitter, nanny, etc.) might go to locate a caregiver in the area, conduct research, schedule an interview, do a background check, and possibly even run payroll services. Determining whether or when such a registry moves from a referral or “matchmaking” service to an “employer” matters a great deal. Once an entity becomes an “employer,” it has an extraordinary amount of responsibility and potential legal liability. Even if the caregiver works for a particular client, that client might simply be the co-employer with the registry such that the client and the registry could both be liable to the caregiver under various employment laws.
General Test for Employment Relationship
The WHD relies upon the “economic reality” test to determine whether an employment relationship exists. In other words, there is no single fact which is determinative, but the WHD (or the courts) will look to several factors to determine if an employment relationship exists. Factors generally reviewed include: whether the potential employer determines the rate and method of payment, whether the potential employer has the power to hire and fire, and whether the potential employer controls the worker’s schedule or conditions of employment. Continue reading