Healthcare staffing firms disagree on whether temporary nursing staff should be classified as W-2 employees or independent contractors. Now, the U.S. Department of Labor is at the center of the dispute.
In August, a coalition of 30 healthcare staffing firms — including AMN Healthcare and Medical Solutions — sent a letter to the Labor Department seeking federal guidance on the classification of temporary nursing staff as independent contractors. The firms in the coalition employ their nurses as W-2 employees, and raised concerns about tech-enabled agencies that do not.
The coalition argued that nurses interact directly with vulnerable populations and require a higher level of training and oversight than contractors do. Plus, contractors are denied employment-related benefits like overtime pay and health insurance, which they allege violates the Fair Labor Standards Act.
On Oct. 10, Littler Mendelson, a Chicago-based employment and labor law firm, penned an opposing letter to the Labor Department. The firm — whose clientele includes tech-assisted nurse staffing platforms, which collectively operate in 38 states — is asking the feds to withhold the "unprecedently broad" opinion letter requested by the coalition.
Littler Mendelson argues that staffing platforms use vastly different business models that could not be covered by a "one-size-fits-all" rule. The relationship between nurses and staffing platforms is often brief and sporadic, and was overstated by the coalition, the firm alleges. Nurses may use multiple platforms to pick up shifts, working as little as one shift with one platform, and platforms do not oversee their care delivery or training.
"It is beyond dispute that the determination of employee or independent contractor classification as a matter of 'economic reality' by way of multi-factor analysis is a fact-intensive exercise," the letter says. "Depending on very specific aspects of any temporary nurse staffing firm's or staffing platform's business model — whether brick and mortar, app-enabled, or otherwise — nurses and other healthcare providers may be properly classified as W-2 employees in some instances and as bona fide independent contractors in others."
The firm expresses concerns that CMS' proposed federal staffing mandate could worsen the nursing shortage, and these platforms — which allow nurses flexibility to work convenient hours in convenient locations — are crucial to meeting the demand.
"[Staffing platforms'] ability to operate lawfully within their chosen business model should not be curtailed especially at a time when their services are most desperately needed," the letter says.