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National Wage and Hour Clearinghouse

Groups lining up to stop employment practices they say are abusive to workers

Sunday, May 09, 2010

They are janitors, laborers, delivery drivers, writers, computer programmers. All are employed by companies -- many wearing company uniforms, working on company computers in company offices performing the work that the company sells -- but technically they are working for themselves as independent contractors, freelancers, consultants or contract workers.

State and federal governments, unions and even employers who do not classify their workers as independent contractors are trying to stop this practice. To a worker in need of a job when there are few jobs to be found, the way in which they are classified may not seem to be a big deal.

"If a worker doesn't get laid off, doesn't get hurt and gets paid minimum wage, from the workers perspective it could be 'no harm, no foul'," said Patrick Beaty, the deputy secretary for Unemployment Compensation Programs for the state's Department of Labor and Industry. "But from my perspective, I'm still out $200 million in a trust fund that is insolvent."

Mr. Beaty is referring to the state's Unemployment Compensation fund, which he said is being underfunded because 580,000 workers or approximately 9 percent of the state's workforce are misclassified as independent contractors. Mr. Beaty said companies that are classifying workers as employees are being hurt by those that aren't when it comes to bidding on jobs. (click on link to read full story)

 

 

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