Act aims to clarify that repondents are not agency employees

US— Legislation has been introduced in the US Congress in an effort to prevent state and federal agencies from classifying research respondents as employees of research agencies.

Republican congressman Mike Kelly plans to use the Research Fairness Act to amend the federal Fair Labor Standards Act to make clear that participants in market research projects and mystery shoppers are independent contractors.

The act was conceived by the Marketing Research Association (MRA) and the Mystery Shopping Providers Association (MSPA) after a number of research agencies found themselves the target of state and federal labor agency audits investigating whether people claiming income from participating in research projects should be treated as employees.

Under fair labor laws, this might put research agencies on the hook for paying minimum wage and overtime to respondents, while restrictions on working hours for young people might also have made research with under 18s difficult or impossible. Employee status for respondents would also bring employment tax liabilities.

Howard Fienberg, the MRA’s director of government affairs, says that state, local and federal agencies are all looking to close the tax gap – the amount of unpaid, late or underpaid tax on income – which is why research agencies and respondents have found themselves the target of these audits.

Yet labor law in the US did not develop with marketing research in mind, Fienberg says. The tests used by regulators to determine whether someone is an employee or an independent contractor were conceived in relation to professions like construction workers or travel agents. “And research respondents are not construction workers,” Fienberg says. “They should be treated differently.”

The Research Fairness Act is designed to achieve that, though Fienberg says it won’t become law this year. “Our main focus is on finding a Congressional Democrat to sponsor it,” he says. Meanwhile, the MRA and MSPA are working on getting a Senate bill introduced.

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