Here is another post in our ongoing series on the news, lawsuits, and updates around 1099 staffing in healthcare. Please check back with us to see the latest as we follow the stories and bring the latest to you.
A federal judge in Kansas recently denied a facility’s efforts to dismiss a case filed by two CNAs seeking unpaid wages against a nursing home operator. While the potential class action case is still in its early stages, it raises some important red flags for nursing professionals who use 1099 staffing agencies to pick up shifts.
These agencies rely on an “independent contractor” business model, meaning that nursing professionals who use their services aren’t provided with employee benefits or protections. As 1099 workers, these nursing professionals are considered to be more like an autonomous business than an employee. While it may be cost-effective for 1099 agencies, this model comes with a key tradeoff — the agencies (and the facilities they support) aren’t allowed to treat these workers like employees. If so, they could face an employee misclassification lawsuit.
Does this sound familiar to you as a nursing professional? The fact is that the agencies you use — and the business models they’re based on — matter. Here’s a look at what it means to be a 1099 worker, rights that you may have if misclassified, and key takeaways from this case to help you better protect yourself in the healthcare gig economy.
Oversight, But No Overtime?
In his Memorandum and Order, U.S. District Court Judge Eric Melgren refused to dismiss the CNAs’ complaint for unpaid wages and overtime because their worker classification as either an independent contractor or an employee is an open question that needs to be litigated.
The nurse staffing app involved in the case alleged that all of the CNAs it placed in facilities were provided with a document asserting that they were independent contractors “regardless of their actual work conditions.” However, Judge Melgren focused on the workplace conditions alleged by the CNAs because it is the nature of the work relationship, not any contract, which determines a worker’s classification.
Specifically, the CNAs alleged that they were treated like employees as the facility would directly manage them during their shifts by:
- Setting the start and end time of shifts and directing when they could take breaks.
- Requiring them to continue working past their shift until they were able to hand off their duties.
- Controlling their dress code and hall assignments.
- Conducting regular supervisor check-ins during shifts where they would be told how to care for their residents — what to do and when to do it.
- Reserving the right to change any of its policies and rules applicable to the CNAs without warning.
In other words, the judge found that the CNAs’ complaint adequately alleged treatment as employees without the benefits of employment. Or, to put it plainly, there was oversight without overtime, allegations which they can now seek to prove at trial.
What Are Your 1099 Worker Rights? FAQ and Takeaways
While the outcome of this case has yet to be determined, it does offer a helpful reminder to nursing professionals (especially CNAs): Just because you’re told you’re a 1099 contractor by a staffing agency doesn’t make it so. This case also helps to raise a few other frequently asked questions.
Q: Can an independent contractor sue their ‘employer’?
A: Yes. Where a worker’s classification is unclear, they have the right to file a lawsuit seeking unpaid wages and other employee benefits they may be owed. If you were hired as a 1099 contractor, but can establish an employee status based on your actual working relationship (and the various tests used by agencies and courts), you can seek relief through the court system by filing a lawsuit.
Q: What are the consequences of misclassifying an independent contractor?
A: There are a number of penalties and damages that a staffing agency or facility could face for misclassifying 1099 nursing professionals. These can arise through an agency investigation, a lawsuit by a misclassified worker, or a combination of both, and can include:
- Fines after a potentially costly and time-intensive audit.
- Unpaid wages, overtime, or other unpaid benefits owed to employees.
- Litigation costs and attorneys’ fees.
Q: How do I protect myself as a 1099 ‘employee’ that has been misclassified?
A: As with most situations that involve the law, the first step is to document important events or situations. Here you would want documentation showing that you are treated more like an employee than an independent contractor. The CNAs in this case point to their inability to control their shift and break times or hall assignments, as well as the direction they received from supervisors on how to provide care for their residents. So, documents like emails (including ones you send after the fact to document a situation), notes, calendar/meeting entries, required training certificates, and written policies and procedures applied to you can serve as helpful evidence in any misclassification lawsuit or investigation.
Q: What resources are available to help me understand my 1099 worker rights?
A: Federal and state agencies have stepped up their enforcement of misclassification laws in healthcare staffing over the past few years. The Department of Labor (DOL) also recently updated the test it uses to measure misclassification, making it harder to classify workers as independent contractors. Many of these agencies provide helpful resources to explain misclassification and worker’s rights. You can also consider filing a complaint with the DOL (or equivalent state agency) to investigate your case. Often, the best way to understand your rights is by talking about your case with a licensed employment law attorney in your state.
Q: Is there an alternative that lets you have the freedom to select your own shifts without losing employee protections?
A: Yes. 1099 worker rights are better protected for nursing professionals when they transition to a company that uses a W2 nurse staffing model. Under this approach, the staffing agency is your employer of record, responsible for ensuring that you receive the pay and benefits you’re entitled to as well as the clinical training and supervision, worker’s compensation, and malpractice coverage that you need to do your job.
Work the Shifts You Want, With the Protection You Need
Leave your worries about 1099 worker rights behind by joining a W2 nurse staffing company that gives you the best of both worlds — scheduling freedom and a team that will give you the support and direction you need to do your job. Find out how you can customize your work schedule with an employer that has your back.
Legal Disclaimer: This article contains general legal information, but it is not intended to constitute professional legal advice for any particular situation and should not be relied on as professional legal advice. Any references to the law may not be current as laws regularly change through updates in legislation, regulation, and case law at the federal and state level. Nothing in this article should be interpreted as creating an attorney-client relationship. If you have legal questions, you should seek the advice of an attorney licensed to practice in your jurisdiction.