NYS Work-site Sweeps uncover Misclassified Workers
Labor Department Announces Enforcement Actions Against More Than Half of the Subcontractors on 'The Province' at RIT Project
Enforcement actions part of statewide crackdown on employers who mis
classify workers as independent contractors or pay them "off the books"
Albany, NY (June 08, 2010) -
State Labor Commissioner Colleen Gardner announced today the results of two enforcement sweeps at the ‘The Province' at RIT (Rochester Institute of Technology) construction project. Widespread violations of State labor laws were found, including nonpayment of overtime, off-the-books employment, failure to carry workers' compensation insurance, and
misclassification of employees as independent contractors by more than half (12 of 21) of the subcontractors interviewed by DoL on the site.
The sweeps were carried out by the New York State Joint Enforcement Task Force on Employee Misclassification on January 26 and February 9 of 2010. The Task Force is an interagency strike force formed in 2007 to address the problem of employers who improperly classify employees as independent contractors or who pay workers "off the books." The strike force that visited ‘The Province' work site included investigators from the NYS Department of Labor and the Workers' Compensation Board.
"In each of these cases, employers brought in crews of out-of-state workers who were typically paid off-the-books," said Commissioner Colleen Gardner of the New York State Department of Labor. "Our announcement today is a victory for workers and taxpayers. We were able to recover these workers' hard-earned wages from out-of-state contractors within a few months."
Gardner added, "The problem of employers misclassifying workers as independent contractors or paying them "off-the-books" is happening statewide. My message to those employers, whether you are from New York or another state, is: ‘You are cheating your workers and the taxpayers, and undercutting honest businesses. We are looking for you - and the chances that you will get caught have never been better.' "
Chair Robert Beloten of the New York State Workers' Compensation Board said, "A business that doesn't carry insurance threatens its workers' well-being and gains an unfair advantage over its law-abiding competitors. Our stop-work order program is an essential tool in dealing with employers who refuse to follow the law and provide workers' compensation coverage for their employees."
Four subcontractors were found to owe a total of $42,835.32 in unpaid overtime wages and liquidated damages. An additional $22,500 in penalties was assessed by the Department of Labor's Division of Labor Standards. The department has already collected $33,728.13 for the labor law violations from three subcontractors, and a fourth subcontractor has agreed to pay a balance due of $31,607.19.
The Department of Labor's Division of Unemployment Insurance found that 12 of the 21 contractors on the site had misclassified 211 workers and owe the Unemployment Insurance Trust Fund more than $80,000 in unemployment insurance taxes.
Three subcontractors were also issued stop-work orders by the Workers' Compensation Board for not carrying workers' compensation insurance.
To learn more about the entire release visit the NYS DOL website.
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