From Forbes, Ginny Hogan provides an overview of worker misclassification issues including industries in which misclassification is more prevelant, pending legislation and what misclassified workers can do. Ginny writes:
Worker misclassification—when employers classify workers as “independent contractors” instead of “full-time employees”—is a massive problem among the self-employed. Steps have been taken in recent years to improve the situation, but new issues have arisen as well.
If you’re self-employed or hiring independent contractors, here’s everything you need to know about worker misclassification.
Effects Of Misclassification
Why do employers misclassify workers? Typically, because independent contractors are cheaper—but only for the employer. Anywhere from 10% to 30% of independent contractors might be misclassified—and the costs are enormous. On average, misclassified workers lose almost $17,000 per year in lost income—which they might not even know about.
“Workers suffering from this may or may not know they have been misclassified, and sometimes they don’t think there’s anything that can be done about it,” says Eric Dirnbach, a union researcher and organizer of 20 years. “Workers are sometimes misclassified as independent contractors, when they should be regular employees on the payroll. It leads to a more precarious job and deprives them of the right to a minimum wage and overtime pay, contributions to social security, workers compensation, and unemployment insurance.”
Read the full story at: Steps You Can Take To Avoid Worker Misclassification
