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Total Articles: 6

Comment Submitted On USDOL's Proposed Worker Survey

As we have been reporting, March 12 was the deadline for submitting comments regarding the U.S. Labor Department's proposal "to collect information about employment experiences and workers' knowledge of basic employment laws and rules so as to better understand employees' experience with worker misclassification." Despite our having asked for a copy of the proposed survey in a letter to USDOL dated January 14, we never received one. Those who responded to our February 20 straw poll said that neither had they received a copy.

IRS Launches New Voluntary Classification Settlement Program

The Internal Revenue Service (the “IRS”) recently announced the Voluntary Classification Settlement Program (“VCSP”), a new program available to businesses, tax-exempt organizations, and government entities that are erroneously treating workers as non-employees or independent contractors. The program provides employers the opportunity to voluntarily reclassify workers as employees with limited federal employment tax liability for past non-employee treatment.

DOL Coordinates With IRS, States On Independent Contractor Misclassification

Earlier this week, the U.S. Department of Labor held a ceremony at which Secretary of Labor Hilda Solis signed a memorandum of understanding with the Internal Revenue Service to "improve departmental efforts to end the business practice of misclassifying employees in order to avoid providing employment protections." The DOL also signed or has agreed to sign memorandums of understanding with officials in 11 states to coordinate efforts to crack down on independent contractor misclassification, including Connecticut, Hawaii, Illinois, Maryland, Massachusetts, Minnesota, Missouri, Montana, New York, Utah, and Washington.

Independent Contractors Are Again Front-And-Center

The U.S. Labor Department announced today that it has entered into a cooperative alliance with the U.S. Internal Revenue Service and others aimed at ending "the business practice of misclassifying employees [as independent contractors] in order to avoid providing employment protections." As the IRS's involvement might suggest, this collaboration has as much to do with enhancing the inflow of tax revenues and other sums to various governments as it does with "employee protections".

Worker (Mis)classification Can Lead To Trouble.

Over the past year, federal and state governmental agencies have signaled their intent to more seriously investigate the misclassification of employees as independent contractors. For various reasons, employers often find it desirable to classify certain workers as independent contractors, but state and federal agencies often look at classification decisions very closely.

WORKER CLASSIFICATION: WILL THE IRS AND OTHERS AGREE WITH YOU? (pdf).

Employers often face a business decision about how to treat a particular worker or group of workers: Are the individuals independent contractors or employees? Often, the independent contractor classification is attractive to employers because it affords certain flexibility. However, there are a number of factors that must be considered when deciding how to classify workers.
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