On January 10, 2014, Governor Andrew Cuomo signed into law the New York Commercial Goods Transportation Industry Fair Play Act  (S5867-2013; A5237b).  The new law targets transportation and delivery companies in New York that classify as independent contractors certain drivers that deliver commercial goods in the state.

Reprinted with permission from the November 27, 2013 edition of the New York Law Journal ©2013 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact ALMReprints.com, 877.257.3382 or reprints@alm.com.

A new bill that will significantly limit the use of independent contractors to

My two prior blog posts have focused on the rising costs of misclassification liability for trucking, delivery, and transportation companies and the industry’s efforts to avoid such costs when confronted by state laws governing the status of independent contractors (ICs).  One of the ways in which such companies have been

February 2013

In the Courts:

  • Lowe’s Home Centers is sued by construction material installer engaged in installing fences, roofs, siding and decks for Lowe’s customers in a class action misclassification lawsuit. The installer seeks to represent himself and  all other similarly situated installers under the Illinois Employee Classification Act, seeking

“Misclassification of employees as independent contractors” is now a common phrase uttered by state and federal legislators and regulators. State task forces have been formed to crack down on businesses that do not pay unemployment insurance and workers’ compensation premiums or withhold taxes for workers whom the states believe

In the past three years, 16 states have passed legislation seeking to curtail the misuse of the independent contractor classification. Yet, despite congressional studies finding that misclassification contributes to the federal and state tax gaps and deprives misclassified employees of workplace protections, Congress has not made independent contractor legislation a national priority until this year.

Now, the second of two bills has been introduced in Congress this year that will not only discourage businesses from continuing to issue Form 1099s to workers who are not legitimate independent contractors, but also will impose obligations on businesses to inform individuals they treat as independent contractors how to challenge their classification.

While the other shoe may be about to drop on companies that may be misclassifying employees as independent contractors, Congress has tempered this latter bill by including a limited form of amnesty for businesses that have had a reasonable basis for past misclassifications.

Neither of the two federal bills, if enacted, would legislate an end to the use of independent contractors; rather, businesses may continue to use independent contractors if they satisfy the legal tests for independent contractors under federal and state laws. As set forth in a forthcoming blog post on this site, businesses can avail themselves of timely alternatives to the costly and often unacceptable alternative of reclassifying independent contractors as employees.

This is the first blog post for IndependentContractorCompliance.com, a website dedicated to three objectives:

  • Collecting and maintaining legal resources on the subject of independent contractors misclassification and compliance for use by lawyers representing businesses,  contractors, and employees as well as the general public including companies, freelancers, consultants, government agencies,