State and federal agencies are issuing a renewed warning to companies that regularly use independent contractors: classify them correctly, or face big penalties.
The push by regulators to enhance employee misclassification detection and enforcement began in 2011, when the Department of Labor and the Internal Revenue Service signed a “memorandum of understanding” in which they agreed to share information to reduce incidents of worker misclassification. The initiative picked up steam this year, however, with enactment of the Consolidated Appropriations Act, which authorized the Labor Department to award $10.2 million in grant funding to states to improve enforcement of misclassification.
