The Importance of Defining Independent Contractor Status for Locum Tenens

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Even before the term gig economy described the modern labor market, locum tenens was a highly sought-after profession. The flexible, mobile nature of locum tenens means professionals stay on an assignment for a short length of time, then move on to another one, perhaps in a different area, city or state. This freedom to choose when and where to work is a core benefit of locum tenens, and it’s the main reason locum providers are classified as independent contractors.

As the gig economy continues to gain momentum, a growing number of employers are struggling to define the difference between full-time employees and independent contractors. This worker classification matters because it impacts overtime, pay, taxation and more.

In response to the changing labor market, the US Department of Labor submitted a new proposed rule on Sept. 22 to streamline the criteria used to classify workers with regard to the Fair Labor Standards Act. While locum tenens providers have always been considered independent contractors, the proposed rule would invite greater interpretation on exactly what classifies an independent contractor and an employee – and it could have a potentially negative effect on locum tenens. This is precisely why entities such as the National Association of Locum Tenens Organizations (NALTO) are working diligently to protect the classification by pushing for legislation that statutorily defines locum tenens as independent contractors.

Right now, locum providers have the unique opportunity to participate in the process, namely by advocating for their independent contractor status – and making their voices heard.

Financial benefits. As an industry, locum tenens has an enormous impact on patient care. Locum professionals provide an estimated 1 million days of coverage and more than 20 million patient visits annually. In addition, the Association of American Medical Colleges estimates that up to 250,000 physicians will retire over the next decade. Many of these physicians would like to continue working on a part-time or temporary basis, and the locum tenens industry empowers them to remain active.

These stats are important to consider because today, 90% of facilities utilize locum providers to solve staffing shortages, realize operational efficiencies, and meet seasonal or temporary patient demand. Providers, in turn, choose locum assignments because of the financial benefits…

Source: The Staffing Stream

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