A medical resident, or resident physician, is a person who has graduated from medical school and is receiving more specialized, hands-on medical training in a hospital or other medical office. Residency usually lasts for three years, during which medical residents work notoriously long hours—sometimes up to 80 hours per week. Though residents put in long hours of work with patients, they often have significant responsibilities, and receive wages for their work, and, under many circumstances, are still considered “in training” or to be continuing their education. Therefore, many have raised the question in recent years: should medical residents be classified as students or employees? This classification has many implications for the residents, including taxes and rights that they have in the workplace.
Supreme Court Case
The issue regarding employment status of medical residents made it all the way up to the nation’s highest court in 2011. The Supreme Court of the United States reviewed a case regarding whether or not medical residents were exempt from paying Social Security taxes.
In 2005, the Internal Revenue Service (IRS) ruled that medical residents who worked over 40 hours per week must be considered “employees” and may no longer be exempt from paying Social Security taxes. This would require the residents and their instructing hospitals to split the additional 12.4% earnings tax for Social Security. The Mayo Clinic challenged the ruling, stating that the primary focus of medical residents is to learn and train, so they should therefore be considered student-employees and should remain exempt from Social Security taxes. The Supreme Court found in favor of the IRS, finding that anyone who worked 80 hours per week and performed highly-skilled duties such as surgeries and other medical treatments could rationally be considered an employee for tax purposes. Social Security taxes from medical residents are estimated to bring in around $700 million per year in revenue.
More recently, the National Labor Relations Board (NLRB) heard a case questioning whether medical residents could join a union under the National Labor Relations Act (NLRA). In that case, Icahn School of Medicine at Mount Sinai argued that the “house staff” comprised of interns and residents more closely resembled graduate students and therefore should not be considered employees with collective bargaining rights. However, the NLRB upheld a 15 year-old decision that stated that residents and other house staff members fit under the definition of “employee” as defined in the NLRA. Therefore, these residents have the rights of any other employee to unionize.
Court decisions have been recently finding that residents are closer to employees than students for several reasons: they already have their degrees, they do not pay tuition to the hospitals for their training, they work long hours, and they are expected to perform tasks that require significant skill and prior training. Following this trend, medical residents should have all of the rights and protections of any other physician or employee in their places of work.
If you have any questions or concerns regarding any employment law matter, do not hesitate to contact the Pershing Square Law Firm for help today.