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California Rep. Lynn Woolsey Fights Employee Misclassification with EMPA

May 27, 2010

Our Orange County, California Employment Attorneys recently posted a blog discussing the introduction of the Employee Misclassification Prevention Act (EMPA), that was introduced into the House of Representatives by California Representative Lynn Woolsey (D-CA), and into the Senate by Senator Sherrod Brown, (D-OH).

California Representative Woolsey recently discussed employee misclassification in an article--stating that it is a huge problem that cheats workers out of income, robs them of their rights, is a threat to fair competition, and leaves taxpayers to deal with the problem.

In her article, Woolsey claimed that the Governmental Accountability Office estimated in 2006, that over ten million independent contractors were misclassified as employees, with at least 30 percent of these workers in California.

Woolsey stated that employee misclassification often happens because employers don't want to pay for Social Security, vacation, pensions, sick leave, and especially labor protections that employees receive, like the right to receive minimum wage and lawful overtime. Woolsey claims that the top reason that employers engage in misclassification is to dodge disability and workmen's' compensation disputes, as well as compensation premiums--so if there is an injury on the job, the worker will have no workman's compensation benefits, no income to cover the time that they can't work, and probably no health insurance--a problem affecting low-income workers across the country.

Woosley also claimed that misclassifying employees harms honest contractors as well, as many contractors misclassify workers to cut labor costs. The taxpayers also reportedly lose greatly with employee misclassification. According to the IRS, when employers misclassify their workers, around $2.7 billion of unpaid taxes are lost in one year.

President Obama is reportedly complementing the EMPA by proposing an independent contractor initiative of $25 million for Department of Labor and Treasury Department activities to address the misclassification problem.

If you or someone you know has experienced employee misclassification in the workplace, our team of experienced California Labor & Employment Attorneys at Howard Law, PC will aggressively represent you and protect your employment rights. Contact us today.

Misclassifying Employees Rips off Workers and Taxpayers and Undermines Fair Competition, The Hill's Congress Blog, May 19, 2010

Heads Up: Bill Brings New Heat on Employee Classifications, HR Morning, May 3, 2010

Sen. Brown Joins Colleague in Announcing Bill to Ensure that Workers Receive Protection and Benefits They Have Earned, Sherrod Brown Press Release, April 22, 2010

Related Web Resources:

California Department of Industrial Relations (DIR): The Division of Labor Standards Enforcement