Takeaway: Employers that engage independent contractors should review their classification of these workers to ensure the arrangements comply with the Fair Labor Standards Act (FLSA) and any applicable state law, which may be different from the FLSA.

In particular, companies should consider reviewing their independent contractor agreements and the application of those agreements to the day-to-day relationship between the company and the workers in order to evaluate whether they have properly classified the workers as independent contractors.

An owner-operator engaged by a freight hauling company as an independent contractor stated a valid claim under the Fair Labor Standards Act (FLSA) and Wisconsin state minimum wage law because he had sufficiently pled that he could not exercise his contractual rights and did not truly control the conduct of his work, the 7th U.S. Circuit Court of Appeals ruled.

The former driver filed a lawsuit in the U.S. District Court for the Eastern District of Wisconsin, alleging that Schneider National Inc. violated the minimum wage requirements of the FLSA and Wisconsin law by misclassifying him as an independent contractor. He also claimed that the company unjustly enriched itself under Wisconsin law and violated federal Truth-in-Leasing regulations.

Two contracts governed the parties' relationship: the driver's lease of a Freightliner truck from Schneider, and an operating agreement under which the driver leased his truck back to Schneider and...

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