Misclassification employees as exempt from overtime is a common violation of federal and Kentucky state wage and overtime compensation laws. It is a scam by which some companies gain a competitive advantage by getting out paying overtime, payroll taxes, unemployment insurance and workers compensation insurance, among other things, all which legitimate, law-abiding companies do pay. 

In a case going to trial in federal district court in Massachusetts, franchisees of Coverall North America, Inc. claim that they were misclassified as independent contractors while they were, in fact, employees that must be paid minimum wage and/or overtime as nonexempt employees.  The case went forward after a ruling by a federal district judge William G. Young that the company had not established that the franchisees were independent contractors and that they were employees working in the company's essential business of cleaning buildings, notwithstanding that many had paid a franchise fee of up to $30,000.

Source: Wall Street Journal

Lexington, Kentucky overtime lawyer Robert Abell helps individuals and employees recover the overtime and wages they've earned but not been paid; contact him at 859-254-7076.

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