b'GUEST VIEWAsk a Lawyer: Do I Have to Pay Salaried Workers Overtime?Just because you pay an employee a salary does not mean they are an ex-empt employee, and you need to check federal and state law to make sure youaremeetingboththemonetarythresholdsandtheresponsibilityChristine thresholds such that you do not have to worry about paying overtime. TaylorTypical lawyer answer? It depends! This isment or recreational establishment who donot recognize or permit the application ofquestions, then he is more likely an employee. a very state-specific issue and also implicatesnot operate for more than seven months inthis exemption, and since an employer mustNext, financial control. Did you provide the federal law. At the federal level we must lookany calendar year. Whether a campground iscomply with the most stringent of the stateequipment to Sam? Do you reimburse him to the Fair Labor Standards Act (FLSA). Whenoperating in their off months is sometimesor federal provisions, the exemption in thefor business expenses? Do you pay him an we talk about overtime we need to thinkhard to determine and where some peopleFLSAmightnotbeavailabletocamp- hourly wage? If you answered yes to these about exempt and non-exempt employees. might run into issues. Maintenance and or- grounds in those stricter states. questions then once again, he is most likely Generally,youmustmeetacertaindering supplies are not enough to tip overFor example, although there is a wholean employee. Sam should be more like the in-threshold monetarily for the salary and someintooperatingbuttakingreservationshost of exemptions in New York state there isdependent landscape company. A company other standards, including independencemight be enoughespecially if that em- not a provision similar to the federal one forthat has its own equipment, realizes their own and responsibilities of the individual, to beployees role is to take reservations during theseasonal employees! Lawyers, doctors, eventprofit and loss, and worries about their own free from the overtime laws. However, thesummer as well! workers for events lasting eight days or lessexpensesin essence a completely separate FLSA gives some exemptions to an amuse- Additionally, some state wage laws mayall have exemptions but not strictly seasonalbusiness from your own. Lastly, we look at the workers. What does this mean? Well to be antype of relationship. Are Sams services a key exempt employee in New York State youaspect of the business? The more integral he would have to pay the worker a weekly wageis to the operation of the business, the less between $937.50 and $1,125.00 (dependinglikely he is an independent contractor.onlocationinthestatedownstateisReceiving a 1099 does not automatically higher). The worker would also have to meetqualify someone as an independent con-the executive or administrative exemptiontractor under the FLSA. You must apply de-which includes specifics regarding their du- fined factors to determine if someone is an ties, level of supervision and independence.independent contractor under the FLSA. Additionally, as campgrounds often em- These are similar to the IRS test and center ploy family members you should know thataround your control over the individual generallyifyouworkdirectlyforyourand their independence from you behav-spouse, parent or child, you do not have theiorally and financially. There are addition-right to overtime, but would if your familialallyavarietyoffactorsthatare relationship was uncle, aunts or siblings. Annon-persuasive, including: lack of a formal important distinction to know is that if youagreement, whether they qualify as an in-work for a corporation or a limited liabilitydependent contractor under another law, company that is owned by your spouse, par- wheretheworkisperformedorthe ent or child, you are entitled to overtime pro- method of payment. tections, because you work for the company,The states employ their own tests which not the individual.can be either of the above tests directly or a So, what does all this mean? Just becausevariation of the same. They might also have you pay an employee a salary does not meandiffering tests depending on the different they are an exempt employee and you needbranches (tax, workers compensation, un-to check federal and state law to make sureemploymentetc.). Thismeansthatthe you are meeting both the monetary thresh- state might determine that the individual is olds and the responsibility thresholds suchan independent contractor when discussing that you do not have to worry about payingif you need workers compensation insur-overtime.ance, but the state might still determine the Can I just 1099 my employees?individual is an employee when it decides Firstif they are going to be hired underyou have to pay them unemployment. Ulti-a 1099 then they are not employees, they aremately, it is easiest to remember that the crux independent contractors. The fake inde- of each test has to do with the businesses pendent contractor is one of the many issuescontrol over the individual, the less control campground owners have when hiring helpyou have, the more likely the individual is an that can expose them to liability. Just be- independent contractor.cause you call someone an independentWhy do we care about all of this? Misclas-contractor in name and even if you pay themsification of employees can lead to severe pursuant to a 1099they still might not befines from multiple branches of federal and an independent contractor. As per usual thisstate government. It can also leave you open implicates federal and state law. to liability for not putting them through There are a variety of tests you need toworkers compensation insurance, which consider depending on your location, butacts as a limit in recovery for the individual generally the overall idea is the same for all(more on that another day). When violating branches of federal and state government andthe FLSA, employers may face a civil penalty can be boiled down to one word: control.as well as criminal prosecution and addi-For example: Sam cuts the grass and doestional hefty fines. The IRS can impose a thelandscapingonthepropertyeverypenalty on federal income tax, Social Secu-Wednesday from 10 a.m.-2 p.m., I providerity and Medicare taxes. As our industry gets the equipment, is he an independent con- more attention due to the increase in interest tractor? Mary runs ceramics every other Sat- and new owners, more lawsuits begin to sur-urday, she brings all the paints, ceramics andface. If you remember nothing else, be cau-chooses how long she runs the event, I pro- tious knowing that your plan to save yourself vide the space, is she an independent con- money up front can unfortunately lead to tractor? Regardless of whether I paid themhigher costs later. both according to a 1099, Sam is likely an employee and Mary is more likely an inde- Christine Taylor, is a Principal Partner at pendent contractor. Why?The Towne Law Firm, P.C. in the firms Albany, Using the IRS test, it determines if some- New York, office, who focuses her practice in the one is truly an independent contractor byareas of Hospitality Law, Business Law, Labor looking at behavioral control, financial con- and Employment Law, Real Estate Law, Trusts trol and type of relationship. When it comesand Estate Law, and Litigation. Taylor has to the behavior of the personwho gives thegrown up in the camping industry, her family instructions? Are you telling Sam how to cuthas owned three campgrounds. Park owners the grass? When to cut the grass? Did you traincan email info@townelaw.com for a chance to Sam how to do it? If you answer yes to thosehave their questions answered.WCM12 March 2022 Woodalls Campground Magazine'