The Impact of Employee Misclassification



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Dishonest employers are misclassifying more and more workers as independent contractors. This misclassification is a fraud that wrongfully denies these employees workers’ compensation when injured, denies the government millions of dollars in payroll taxes to support Medicare, Social Security, Unemployment Insurance, and these workers fundamental rights under various state and federal laws. It is another way employers shift the cost of accident and injury to the taxpayer. As this fraud continues to grow, particularly in construction, honest employers who want to abide by the law and help their employees are faced with a growing reality: as they continue to lose business to competitors who cheat the system, they will either go out of business or they will join those who cheat. It is important to be able to spot misclassification and to understand the methods used by these dishonest employers. Anyone who represents workers or who cares about preserving honesty and fair play in business dealings should be fully aware of this growing national problem and do everything possible to stop it.

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