When employers misclassify workers they attempt to cheat injured workers of adequate workers compensation benefits. In most jurisdictions workers comp rates are determined by the wages paid to the injured worker at the time of their injury.
Disability rates for workers' compensation benefits are based upon the computation of the wages of the injured employee. Statutorily, the wages are defined to mean "the money rate" at which the service rendered is paid. That rate is determined by the wages in effect according to the contract of hiring in force at the time of the accident or exposure of the employee. Board and lodging, when provided by the employer are usually considered as wages, unless the parties have entered into a contract at the time of hiring to set an alternative value. In those instances where wages are determined by the output of the employee, the daily wages are calculated by dividing the number of days the injured employee was actually employed into the total amount that the worker earned during the preceding period.
The US Department of Labor (DOL) strictly monitors misclassification of workers and takes enforcement action when appropriate. The U.S. Department of Labor has recovered $104,837 in overtime back wages for 57 workers who had been misclassified as independent contractors and thereby denied overtime compensation for all hours of their work in violation of the Fair Labor Standards Act, following an investigation by the department’s Wage and Hour Division. The workers were employed by Cecil Parker Jr., the owner of a debris cleanup company in Anahuac.
The DOL reports of the serious consequences of misclassification, "The misclassification of employees as independent contractors is an alarming trend, particularly in industries such as construction that often employ low-wage, vulnerable workers, and in which the division historically has found significant wage violations. The practice is a serious threat both to employees entitled to good and safe jobs, as well as to employers who obey the law. Too often misclassified employees are deprived of overtime and minimum wages, and forced to pay taxes that their employers are legally obligated to pay. Honest employers have a difficult time competing against scofflaws. The Labor Department is committed to ensuring that employees receive the pay and benefits to which they are legally entitled and to level the playing field for employers that play by the rules."
The States need to provide better enforcement of how workers are classified and paid by employers. Injured workers continue to be "short changed" in many ways by misclassification.
Disability rates for workers' compensation benefits are based upon the computation of the wages of the injured employee. Statutorily, the wages are defined to mean "the money rate" at which the service rendered is paid. That rate is determined by the wages in effect according to the contract of hiring in force at the time of the accident or exposure of the employee. Board and lodging, when provided by the employer are usually considered as wages, unless the parties have entered into a contract at the time of hiring to set an alternative value. In those instances where wages are determined by the output of the employee, the daily wages are calculated by dividing the number of days the injured employee was actually employed into the total amount that the worker earned during the preceding period.
The US Department of Labor (DOL) strictly monitors misclassification of workers and takes enforcement action when appropriate. The U.S. Department of Labor has recovered $104,837 in overtime back wages for 57 workers who had been misclassified as independent contractors and thereby denied overtime compensation for all hours of their work in violation of the Fair Labor Standards Act, following an investigation by the department’s Wage and Hour Division. The workers were employed by Cecil Parker Jr., the owner of a debris cleanup company in Anahuac.
The DOL reports of the serious consequences of misclassification, "The misclassification of employees as independent contractors is an alarming trend, particularly in industries such as construction that often employ low-wage, vulnerable workers, and in which the division historically has found significant wage violations. The practice is a serious threat both to employees entitled to good and safe jobs, as well as to employers who obey the law. Too often misclassified employees are deprived of overtime and minimum wages, and forced to pay taxes that their employers are legally obligated to pay. Honest employers have a difficult time competing against scofflaws. The Labor Department is committed to ensuring that employees receive the pay and benefits to which they are legally entitled and to level the playing field for employers that play by the rules."
The States need to provide better enforcement of how workers are classified and paid by employers. Injured workers continue to be "short changed" in many ways by misclassification.
Related articles
- Inconsistent Enforcement of State Wage and Hour Laws Could Lead to "Regulatory Race to The Bottom, " New Study Finds (workers-compensation.blogspot.com)
- Minimum Wage, Overtime Laws Due For Reform: Republicans (huffingtonpost.com)
- Workers Compensation, Pensions and Bankruptcy (workers-compensation.blogspot.com)
- Penalties, Paper and The Injured Worker (workers-compensation.blogspot.com)
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