Employee classification may refer to one of two scenarios:
1. Classifying an employee as either exempt or non-exempt under federal and state wage and hour laws, such as the Fair Labor Standards Act (FLSA), which regulates minimum wage, overtime, recordkeeping and child employment standards at the national level.
2. Classifying a worker as either an employee or an independent contractor under applicable federal and state laws. Different rules apply for different purposes and jurisdictions.