Takeaways

• The appeals court conducted an exhaustive review of the factors defining independent contractor status under the Fourth Circuit’s McFeeley economic realities test.
• Merely calling legal counsel is not enough to establish a good-faith defense. Employers must provide sufficient information to counsel so they can offer informed advice, and employers must act on such advice proactively.
• The staffing agency’s clients were not defendants in this case, but the verdict is an important reminder for healthcare entities to take steps to insulate themselves from potential joint-employer liability when contracting for healthcare professionals.

The U.S. Court of Appeals for the Fourth Circuit recently affirmed a $9.3 million judgment against a medical staffing agency in a Department of Labor (DOL) Fair Labor Standards Act (FLSA) enforcement action alleging nurses were misclassified as independent contractors. Chavez-DeRemer v. Medical Staffing of America, LLC, dba Steadfast Medical Staffing, Nos. 23-2176 and 23-2284 (2025). The case offers a cautionary tale for staffing agencies and their healthcare provider clients.

Background: Steadfast Model

Steadfast Medical Staffing maintained a registry of licensed nurses and connected them with client healthcare facilities. Nurses joining the registry completed an “application for employment,” which referred to the nurse as “employee” and to Steadfast as “employer.” After passing background checks and other pre-hiring requirements,...

Read Full Story: https://news.google.com/rss/articles/CBMitAFBVV95cUxPV0dFWkpjTWlpcFdrSF92UWpm...