Share
Readers of this blog will be aware that the misclassification of employees as independent contractors has been a major concern of state and federal authorities for several years. Employers don’t provide workers compensation insurance for independent contractors, they’re not eligible for unemployment compensation benefits, and they’re not paid overtime if they work more than 40 hours in a workweek. Depending on your perspective, these facts represent either cost savings or “wage theft.” Departments of Labor at both the federal and state levels have been on a campaign to encourage employers to classify their employees correctly.
Against this backdrop, it’s somewhat anomalous that misclassification of employees as independent contractors doesn’t in itself violate the federal Fair Labor Standards Act. Democratic Congressman Joe Courtney of Connecticut’s 2d District is a co-sponsor of the “Payroll Fraud Prevention Act of 2014,”which would expand the FLSA’s coverage to define a new category of workers referred to as “non-employees,” and would make it a new offense to misclassify employees and non-employees. The Act authorizes the DoL to impose a fine of up to $5000 per worker for each violation.
The proposed statute would also require employers to notify their workers of how they have been classified, direct them to a U.S. DoL website for further information, and advise them to contact the DoL if they suspect the employer has classified them incorrectly. The law would also permit misclassified workers to collect triple damages for minimum wage or overtime violations.
Similar statutes were proposed in the Senate in 2011 and 2013. It seems unlikely that the current proposal will make it through the Republican-controlled House
This blog/web site presents general information only. The information you obtain at this site is not, nor is it intended to be, legal advice, and you should not consider or rely on it as such. You should consult an attorney for individual advice regarding your own situation. This website is not an offer to represent you. You should not act, or refrain from acting, based upon any information at this website. Neither our presentation of such information nor your receipt of it creates nor will create an attorney-client relationship with any reader of this blog. Any links from another site to the blog are beyond the control of Pullman & Comley, LLC and do not convey their approval, support or any relationship to any site or organization. Any description of a result obtained for a client in the past is not intended to be, and is not, a guarantee or promise the firm can or will achieve a similar outcome.
About Our Labor, Employment and Employee Benefits Law Blog
Alerts, commentary, and insights from the attorneys of Pullman & Comley’s Labor, Employment Law and Employee Benefits practice on such workplace topics as labor and employment law, counseling and training, litigation, union issues, as well as employee benefits and ERISA matters.