State legislatures have adopted statutes requiring brokers to supervise their agents. In most states, this supervisory function directly conflicts with labor laws governing independent contractors. These conflicts have opened the door for attorneys to allege that Boston Pads, Coldwell Banker, Redfin, and ZipRealty have misclassified their agents as independent contractors rather than employees. This litigation asserts that labor laws controlling independent contractor status should take precedence over real estate law. Other challenges to independent contractor arise from litigation outside the real estate industry, IRS regulations, and rulings from the National Labor Board. This session will cover:
1. An in-depth review of the current litigation including potential effects on the real estate industry in your area.
2. How the three-prong vs. 11-prong tests for independent contractor status differ.
3. Broker risks and best practices to mitigate those risks.
4. The greatest risk: agent teams where independent contractor team leaders (not the supervising broker) treat their independent contractor team members as employees. Examples include requiring them to prospect at certain times, hold open houses, or use the team leadâ€™s systems and tools. Steps brokers can take to protect themselves from violating Local, State, and Federal Labor Laws.
5. How and why arbitration provisions in your Independent Contractor Agreements may protect you from potential class action lawsuits.
6. Potential risks for franchisors based upon lawsuits from outside the real estate industry. What can be done to mitigate these risks.
7. What if all agents became employees? New financial models, innovations, and how brokers would handle their current situationâ€”breakout and group discussion.
Length: 60-180 minutes
Audience: Association and Company Leadership, Broker-Owners, Managers, and Agent Team Leaders