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The U.S. Department of Labor recently scored a meaningful victory in yet another court case where a company failed to structure, document, and execute properly an independent contractor relationship with workers who were paid on a 1099 basis.  In Hilda L. Solis, Secretary of Labor v. Cascom, Inc. and Julia…

On September 19, 2011, Secretary of Labor Hilda Solis and IRS Commissioner Doug Shulman signed a Memorandum of Understanding to coordinate both agencies’ law enforcement efforts aimed at businesses that misclassify employees as independent contractors.  At a ceremony held at the Labor Department headquarters in Washington, Secretary Solis said, “We’re…

The IRS yesterday announced a new program to permit taxpayers to voluntarily reclassify independent contractors as employees for federal employment tax purposes.

The program, called the “Voluntary Classification Settlement Program” (VCSP), would allow businesses to voluntarily reclassify workers who currently receive 1099s from the company by making what is referred…

On Friday, April 8, 2011, Senators Sherrod Brown (D-Ohio), Tom Harkin (D-Iowa), and Richard Blumenthal (D-Conn.) introduced the Payroll Fraud Prevention Act (S. 770), a trimmed-down version of the Employee Misclassification Prevention Act bill that was introduced into both houses of Congress a year ago. Taking a cue…

The Utah House approved on February 10, 2011 a bill (S.B. 35) targeting construction companies that classify individuals as owners in order to avoid paying for workers’ compensation insurance and unemployment insurance or withholding taxes.  The bill, called the Construction Licensees Related Amendments, seeks to make ineffective a tool…

The Pennsylvania Construction Workplace Misclassification Act was signed into law on October 13, 2010.  Also called House Bill 400 and Act 72 of 2010, the new law went into effect on February 10, 2011.

Earlier this month, the Pennsylvania Department of Labor and Industry published three documents on its website…

Listening to President Obama address issues of national importance during his 2011 State of the Union address last night, anyone familiar with independent contractor compliance and 1099 issues could not help but notice two meaningful references to these two related matters, both of which gained widespread attention in 2010.

1. …

Last month, the federal district court judge assigned to handle dozens of state law class action claims brought around the country against FedEx Ground by its drivers, who have claimed they are “employees” misclassified as independent contractors (ICs), issued a comprehensive ruling covering 42 of the of the remaining lawsuits. …