It seems there are already some converging elements that could spell trouble for organizations using contract labor in addition to their full time workforce early in this new year. A perfect storm of factors may produce a wave of labor-related litigation in 2015, much of it directed at employers. Is your contingent workforce program protected? Here’s what is driving the tsunami of lawsuits and how your program navigate away from costly litigation.
With labor trends like diversified contingent workforces, rising numbers of independent contractors and telecommuting continuing to grow (and preparing possibly to overtake traditional work roles), pushback can be expected. The political and media focus is on topics such as income/wealth disparity, minimum wage-raising campaigns and numerous, high-profile collective bargaining cases moving through the courts. Seemingly, with the increase of active labor lawsuits, this has captured the attention of the legal professionals offering more incentive to launch litigation against employers for a whole host of transgressions.
According to an eye-opening piece in Forbes, the number of securities class action lawsuits fell precipitously in 2014 and private lawyers have been flocking to those centering on labor laws and practices. The article examines why, according to a legal expert, “If you’re an employer in 2015 and you want to comply with the law and manage litigation risks, you must focus on payroll and wage-and-hour issues. You have a migration of plaintiff lawyers into that area, I think, because of low barriers to entry.”
While labor lawsuits are nothing new – cases focusing on wage theft, ERISA/retirement issues, worker/IC classification among others – there is reason to believe that these types of actions are poised to increase in 2015. Read the Forbes piece for the sobering details and citations of recent high profile cases which you’re likely already following.
So what can be done to protect against a developing trend for organizations maintaining a significant contingent workforce? The best advice is to rely on professional workforce management solution providers who maintain stricter compliance policies and service providers like Employer of Record services whose stock and trade is dependent on staying on the legal side of things. The litigation risk that is presented by the implementation of the ACA (Obamacare) as just one example. Companies managing all of the HR and benefits functions internally for their organizations would have their hands full dealing with the ramifications and implications of this issue alone. Keeping ahead of the laws surrounding IC compliance, co-employment, and an array of issues is enough of a full time job for a large team. Perhaps these new standards are best met with updated strategies for the administration of the 21st Century workforce. Consider making 2015 the year of the workforce management solution provider instead of the year of the labor lawsuit. Visit here to learn more.