Lowe’s has agreed to a $2.85 million settlement with installation workers who previously filed a class action lawsuit in New Jersey federal court, claiming they were denied benefits and misclassified as independent contractors rather than employees. The settlement payout will benefit approximately 450 installation workers and companies who provided services to Lowe’s customers in New Jersey. The lawsuit alleged that Lowe’s misclassified these workers and companies as independent contractors, which prevented them from access to benefits such as liability insurance coverage, workers compensation, temporary disability and health insurance, as well as eligibility for Social Security and Medicare.
One of the installation workers alleged that although he worked 80 hours a week on jobs for Lowe’s, he didn’t get benefits and was required to pay self-employment tax on all income he earned from those jobs. The lawsuit claimed that installation workers should be classified as Lowe’s employees because the work they performed was controlled by the company, including scheduling the installations, inspecting the work done by the employees, and requiring the customer to pay Lowe’s for the services directly. The suit also alleged Lowe’s required the installation workers to undergo background checks and to wear Lowe’s company shirts and hats while on the job.