A claim against EOG Resources Inc., formerly Enron, has beenbrought in U.S. District Court for the Southern District of Texasalleging ERISA and Fair Labor Standards Act violations.

The complaint alleges EOG misclassified the plaintiff and otherworkers as independent contractors, subsequently denyingthem overtime pay and access to company-provided retirement andhealth benefits.

Under the FLSA, employers are required to compensatehourly workers time clocked above 40 hours. Employers are exemptfrom such requirements in the case of bona fide independentcontractors.

Over the years, courts have struggled to define which conditionsof an independent contractor’s working relationship wouldconstitute the role of a full-time employee, thereby affordingprotections in the FLSA and ERISA.

If a worker is “economically dependent” on the firm they workfor, they are considered an employee, and not a contractor, underthe FLSA.

A Department of Labor fact sheet says the Supreme Court hasconsidered several factors in questions pertaining to employeeclassification, but no single factor is considered to be fullydetermining of employee classification.

The importance of the work done to the business, the permanencyof the relationship, the degree to which the worker’s own equipmentis used, the degree of control the employer has over the worker,the opportunity for profit and loss, and whether or not the workerhas relationships with other employers are all factors courts haveweighed when determining employee status.

Workers can be functioning as full-time employees even when theythink they’re contractors, and even if the worker goes so far as tosign a contract saying they’re independent, and write off businessexpenses.

In the EOG claim, the plaintiff worked as an environmentalanalyst for nine consecutive years, compensated as a contractorwith an hourly wage all the while.

“We believe he an other misclassified independent contractors ofEOG are entitled to overtime and other compensation per therequirements of the FLSA and ERISA,” said Allen Vaught, an attorneywith Barron and Budd, the firm representing the plaintiff.

In an interview, Vaught said he thinks there could be greatercoalescence of ERISA and FLSA claims going forward, as theDepartment of Labor has pushed enforcement of employeeclassification.

“There is so much overlap in the two laws, but traditionallyattorneys have tended to specialize in one area or the other,” heexplained.

Back in 2000, Microsoft settled two class actions brought bytemporary workers for nearly $97 million.

In Vizcaino vs. Microsoft, freelancers were not eligible toparticipate in the company’s defined contribution plan, which saidthat each regular employee was eligible to participate.

An IRS audit found the contracted employees were misclassified,because their duties were the exact same as full-timeemployees.

ERISA has a two-part test to determine if an individualqualifies to participate in a retirement plan. First, they must bean employee, not a contractor. And second, they must meetrequirements laid out in plan documents, such as vestingperiods.