Incentives Don't Make Employees: IA Seeks Clarification

In the US, trade body the Insights Association (IA) is urging the Department of Labor (DOL) to clarify in regulation that individuals receiving incentives for participating in marketing research studies are independent contractors, and not employees.

IA is pressing for this clarification because the DOL proposes to rewrite how the Fair Labor Standards Act (FLSA) regulations determine whether an individual is an employee or independent contractor. According to the IA, the 1938 FLSA and other regulations did not develop with marketing research in mind, were conceived in relation to classic professions such as construction workers and travel agents, and thus struggle to handle reimbursement for research participation. As explained to the DOL by the IA, participants in marketing research may take part in multiple studies for multiple companies in the same year, or even at nearly the same time, but that participation is not a profession, and participants cannot easily make a living from it.

In a statement, Howard Fienberg, IA's VP Advocacy, said: 'While it might appear viscerally obvious that marketing research participants are not employees of companies or organizations conducting research studies, the firms that contract with these individuals face troubling challenges to that nonemployee status. The cost of defending against these challenges and the uncertainty they create has a material negative effect on the industry. It also threatens the integrity of the research process and the resulting insights that people, companies, organizations and the governments rely upon every day to be able to learn and understand consumer attitude, behavior and opinion'.

Web site: www.insightsassociation.org .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.