The Fair Labor Standards Act (FLSA) guarantees employees the rights to benefits, such as minimum wage rates - currently $7.25 per hour - and overtime for any hours worked in excess of 40. These measures are meant to cut back on instances in which employers abuse workers' privileges and neglect to adequately pay them for their time and attendance.

However, there are certain exemptions that do not require businesses to adhere to all of the FLSA's provisions. One applies to independent contractors, who are workers hired specifically to complete a one-time, or limited-time job because of their special skills in a given field. This can include freelance writers or graphic designers as well as day laborers or painters.

Employers should be careful when determining  whether a hired worker is an independent contractor on their payroll because the FLSA has very specific requirements they must meet. If those are unclear, businesses can outsource human resources to reduce liability, ensure positions are correctly documented and in compliance with federal regulations.

They should also know that there are certain factors of employment relationship that do not factor in the delineation between employees and contracted workers, as per the FLSA. These include:

- The location where work is performed
- If the independent contractor is licensed by the federal/state government
- If a formal employment agreement has not been arranged

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