b'INDEPENDENT CONTRACTOR! REALLY?Bob DunleveyF or as long as one can remember, employersnext ten years by the IRS misclassification initiative have been misclassifying employees andalone.Ohio previously estimated that 92,500 calling them independent contractorsemployees had been misclassified costing the state to save money on taxes and overtime.But, thetreasury $363 million. In the U.S., it is estimated game is coming to an end and you need tothat 30% of companies misclassify employees3.4 make sure that all of your workers are properlymillion workers.The most frequently misclassified classified.Both at the state and federal levels,workers are truck drivers, construction workers, legislation and enforcement initiatives are arisinghome health to curb the abuse of misclassifying employees.Justaides, high recently, the U.S. Department of Labor awardedtech engineers $10.2 million in grants to 19 states for continuedand sales independent contractor misclassificationpersons.The construction Legislation andindustry enforcement initiatives areappears to be getting the arising to curb the abuse most attention. Remember, detection and enforcement.The grants arejust because focused on unemployment insurance programsyou pay a and, more specifically, a companys failure to paycommission unemployment insurance premiums for workersto a worker, treated as independent contractors but who aresuch as a sales actually employees.In addition, in the Presidentsperson, doesnt 2015 fiscal year budget, the fifth of six fundingmean that he highlights listed in the Department of Labor budgetor she is an is increasing support for agencies that protectindependent workers wages and overtime pay, benefits, healthcontractor.and safety, and investing in preventing and detectingBy the misclassification of employees as independentmisclassifying contractors.The DOL also signed a Memorandumworkers as of Understanding with the IRS creating a jointindependent initiative to improve compliance by enhancingcontractors, an employer can save up to 30% of the the exchange of information between the twocost of the worker including such things as federal agencies as to employers possibly violating the law.social security tax, federal unemployment tax, state Moreover, approximately one-third of states recentlyunemployment insurance, workers compensation have enacted legislation to prevent misclassificationpremiums, and overtime compensation.No wonder which tightens the definition of employee insuch abuse currently exists and why our state and various state employment laws, including workersfederal governments are cracking down.compensation, unemployment compensation andThe risk of misclassification has always been state wage-hour laws. significant.For example, the failure to withhold Why is this being done?Monies neededmoniestaxes can result in the collection of back taxes, lost!Many state unemployment and workersinterest assessments and penalties.Workers compensation funds are underfunded and allmisclassified who are injured on the job can subject governmental entities are looking for more money. an employer to the total cost of the claim being The federal government estimates that $7 billionpassed directly through to the employer and the can be recouped in additional federal taxes in theretroactive payment of workers compensation 16 www.mrca.orgMidwest Roofer www.mrca.orgMidwest Roofer 16'