Employee or Independent Contractor? It’s not just a label.
I received an interesting response to my last post on the correlation between the unemployment rate and discrimination charges, which lead me to this blog post. A reader suggested that employers could protect themselves by not having any employees and hiring only independent contractors. Yes, there are many benefits to hiring independent contractors as long as they are truly that – independent. However, misclassification of independent contractors when they really are employees is common. This mistake has costly consequences for employers. Below are 3 costs to employers who misclassify independence contractors: Unpaid taxes. Should the IRS audit your business and reclassify one or all of your workers as an employee, you now owe the IRS employment taxes, the employer’s share of FICA taxes, and federal unemployment taxes, which were not paid because the misclassified worker was treated as an independent contractor. Additionally, the employer would be liable for penalties and interest for failure to pay the taxes and failure to file payroll tax returns. Meal and Rest Break Premium Pay. A worker classified as independent contractor probably did not receive … Continue reading
Unemployment Rate Stays at 9.1% – What This Means for Employers.
Today the U.S. Bureau of Labor Statistics reported that the number of unemployed persons remains at 14.0 million and the unemployment rate held at 9.1 percent (in California, it’s even higher at 12.4%). The rate has shown little change since April. The number of long-term unemployed (those jobless for 27 weeks and over) was about unchanged at 6.0 million in August and accounted for 42.9 percent of the unemployed. Among the major worker groups, the unemployment rates for adult men (8.9 percent), adult women (8.0 percent), teenagers (25.4 percent), whites (8.0 percent), blacks (16.7 percent), and Hispanics (11.3 percent) showed little or no change in August. The jobless rate for Asians was 7.1 percent, not seasonally adjusted. Why this matters for employers: 1. Statistics show that historically, there has been a near direct correlation between the unemployment rate and the number of discrimination charges filed with the Equal Employment Opportunity Commission (EEOC). Data from U.S. Bureau of Labor Statistics. The graph took a while to create but you are free to use it with the following credit “Law Office … Continue reading
New Notice Requirement for Employers: Employees’ Right to Unionize
The National Labor Relations Board has issued a Final Rule requiring most private-sector employers to post a notice to employees of their rights under the National Labor Relations Act (NLRA). Here is a quick Q&A for employers. Who has to post this new notice? All private-sector employers (including labor unions) subject to the National Labor Relations Act. The new notice requirement does not apply to agricultural, railroad and airline employers or the U.S. Postal Service for the time being. What does the notice say? Under the NLRA, you have the right to: Organize a union to negotiate with your employer concerning your wages, hours, and other terms and conditions of employment. Form, join or assist a union. Bargain collectively through representatives of employees’ own choosing for a contract with your employer setting your wages, benefits, hours, and other working conditions. Discuss your wages and benefits and other terms and conditions of employment or union organizing with your co-workers or a union. Take action with one or more co-workers to improve your working conditions by, among other means, raising work-related complaints … Continue reading
California Workplace Leave for Organ Donation and Bone Marrow Donors
Earlier this month, the Governor approved a new senate bill amending and clarifying California law on organ and bone marrow donation leave. Here is a quick summary: • Employers with 15 or more employees must provide paid leave to employees undergoing organ or bone marrow donation procedures. • Employee requesting leave must provide employer written verification that s/he is a donor and that it is medically necessary. • Employees are entitled to the following paid leave in a one-year period: – Organ donation – up to 30 business days (not calendar days) – Bone marrow donation – up to 5 business days. • Employees on leave must be treated as actively working. The leave provided may not be considered a break in service for purposes of salary adjustments, sick leave, vacation, paid time off, or seniority. • Organ and bone marrow donation leave is in addition to FMLA or Moore-Brown-Roberti Family Rights Act and cannot be taken concurrently. • Employers may require that the employee take earned but unused sick leave, vacation, or paid time off: – Organ donation – … Continue reading