This is a special follow-up Action Alert from the ATA Advocacy Committee. Read the original ATA Action Alert: Share Why Contractor Status Works for You.
New Proposed Rule Could Classify Independent Translators and Interpreters as Employees Under the Fair Labor Standards Act (FLSA)
On October 13, 2022, the US Department of Labor (DOL) published a notice of proposed rulemaking (NPRM) that puts forward a restrictive interpretation of the “economic realities” test, which is used to determine an individual’s status as an employee or independent contractor for the purposes of the FLSA.
The new proposed economic realities test would include the following six factors:
- Opportunity for profit or loss depending on managerial skill
- Investments by the worker and the employer
- Degree of permanence of the work relationship
- Nature and degree of control
- Extent to which the work performed is an integral part of the employer’s business
- Skill and initiative
Factor 3, which may restrict freelancers from working with repeat clients, could be problematic for language professionals, as could Factor 5, which is very similar to the infamous “B” condition of the ABC test and would prevent businesses from contracting with freelancers to perform work that is considered an integral part of the hiring entity’s business (i.e., a language services company could not contract with freelance translators and interpreters).
The proposed regulations, if finalized, would expand the coverage of the FLSA by treating as “employees” a large number of individuals who, under current law, are properly classified as independent contractors. This could be detrimental to many translators and interpreters working as independent contractors.
The DOL is now asking for written input from independent contractors during the prescribed public comment period for rule changes, which closes on December 13, 2022.
In June 2022, the DOL asked for input from independent contractors on a new potential rule for determining employee and independent contractor status under the FLSA. ATA members came out in full force to participate in these public forums.
Currently, more than 75% of language professionals work as independent contractors, providing knowledge-based, professional services that require a high degree of professionalism, ongoing professional education, and professional compensation. Forcing language professionals who wish to be independent contractors to have employee status would disrupt vital language access services, which are protected under federal law.
Why This Matters to Translators and Interpreters
While employee classification for all may seem like a fine idea in principle, the reality is far different. Employee status is not necessarily a safeguard against exploitation (e.g., wage theft is a significant problem across industries and regions). As we saw in California with AB 5, language services companies (LSCs) that rely on the services of professional translators and interpreters did not respond by hiring contractors as employees, paying higher compensation, or providing benefits. Instead, they unilaterally terminated contracts and made out-of-state residency a condition for working with them, seeking to hire only service providers outside California. If enacted, this rule could have similar consequences, decimating the business of language professionals in the U.S.
Language professionals who work more than 40 hours a week as freelancers for a single client may be misclassified and entitled to recourse. Fortunately, remedies already exist for these misclassified individuals. The majority of language professionals, however, hold themselves out for hire to any client who requests their services and agrees to their professional fees, be that client an LSC, another public or private entity, or an individual. These professionals should have a say in how they are classified, a freedom that could be stripped with the enacting of this more restrictive law.
What Can You Do?
- Read and share ATA’s official statement on this proposed rule.
- Comment on this proposed rule.
- In your comment, tell DOL what you do, why being an independent contractor works for you, and why being an employee likely wouldn’t be feasible, either because of your language combination, geographical location, specialization, etc.
- At the end of your comment, offer the solution that DOL can return to the pre-2021 economic realities test, which better honors the independent nature of language professionals’ work, protects independent translators and interpreters nationwide, and safeguards language access and our economy.
- Share your comment no later than December 13, 2022.
DOL Needs to Hear from YOU!
If you need any help, contact the ATA Advocacy Committee or any of its members for tips on telling your story and written samples you can use for inspiration.