Lawsuits alleging violations of Texas employment law are becoming more and more prevalent as employees attempt to protect their rights under federal and state labor laws, and no companies are more vulnerable to litigation than startups. A San Antonio attorney or a lawyer in Dallas or other large Texas metro areas are likely to be called upon to represent cases against employers by individuals who want to claim violation of the labor laws that distinguish independent contractors from employees. Especially as federal programs like Obamacare demand more from small businesses and startups, more litigation is expected to follow, as this special interest article reports.
In states like Texas where the business climate fosters innovation, growth and entrepreneurship through minimal taxes and financial incentives, a variety of industries are seeing economic growth and booming business. And while that’s great for the overall economy, job creation and the balance between large-scale production and consumption, some workers are worried they’re being left behind. Hubs for technological innovation like Houston and San Antonio mean that the cities are seeing a rise in the value of skilled labor, but the laborers themselves are becoming more likely to hire a San Antonio attorney who focuses on business law like Doug Shumway to make sure they don’t get screwed.
And why? Texas employment law allows businesses from small startups to large corporations to hire independent contractors for services “not integral to the business,” and employers have a large incentive to do so: money. Independent contractors aren’t eligible for benefits, minimum wage, overtime, and in some cases, legal protection. This allows businesses to pay workers under the table in cash or more easily commit payroll fraud that leaves the contractors in the lurch.
While the misuse of independent contractors is most common in industries like technology, construction and entertainment, lawyers like Shumway contend that the practices may be more pervasive. Additionally, and especially in big cities, some startups may want to retain a San Antonio attorney or Dallas or Houston-based lawyer to be sure they are following the Texas employment law guidelines and avoid lawsuits altogether.
For people getting a paycheck, there are a few simple tests that can provide clues to whether they’re in the right category: contractor or employee. “If the person’s duties are vital to the business, or if the worker does not have much control over his or her work – such as setting hours, what to wear, how to conduct him or herself – then he or she likely also an employee,” according to a federal ruling that a San Antonio attorney could draw on when bringing a case against an employer. For workers found to be employees and not independent contractors, they may be entitled to unpaid wages and overtime pay.
Startups especially should be careful when deciding to classify someone as an employee or contractor. Familiarity with the current Texas employment law or consultation with an attorney who has experience in the area would help small and expanding startups avoid lawsuits and the expenses associated with them.