Misclassification of truckers as “independent contractors” violates state and federal labor and tax laws
A report released last month indicates about 49,000 of the nation's 75,000 port truck drivers were misclassified as independent contractors, violating state and federal labor and tax laws, including provisions covering wage-and-hour standards, income taxes, unemployment insurance, union-related matters and workers' compensation.
The joint study was conducted by the National Employment Law Project, Change to Win Strategic Organizing Center and the Los Angeles Alliance for a New Economy. According to the report released February 19, 2014, port drivers filed about 400 complaints with the state's Division of Labor Standards Enforcement for wage theft violations arising from the misclassification. Penalties in 19 cases already adjudicated averaged $66,240 per driver. Claims in reviewed pending complaints average a little over $127,000 per driver.
According to the report, “Total quantifiable costs of misclassification nationally — tax losses plus wage-and-hour violations — run to $1.4 billion annually with non-quantified costs likely exceeding the figure significantly.”
Liability in California
“This emerging justice did not materialize out of nowhere. It is coming from working people teaming up with labor advocates to fight for a basic right provided them by US labor law: the right to proper classification as an employee of a company, not an ‘independent contractor.' This report tells of numerous legal actions that are starting to generate monetary penalties for the misclassifying employers, to the tune of some $850 million per year in potential liability in California alone.”
The report recommended state and federal labor and tax law enforcement agencies should prioritize investigations in those industries in which widespread violations have the greatest impact on workers and lawful employers, be adequately funded and coordinate efforts to fight misclassification in the trucking industry.
The report also recommended anti-retaliation measures for whistle-blowers should be strengthened.
The full report can be found on the National Employment Law Project website.
Concerns about being classified as an independent contractor?
Are you or someone you know currently classified as an “independent contractor”? Do you have questions about how your job is classified and the impact it has on your rights and compensation? If so, don't hesitate to contact leading California employment lawyers from Kingsley & Kingsley to take advantage of a free initial consultation. To discuss your situation call us toll-free at (888) 500-8469 or clicking here to contact us regarding your case.