HR Management & Compliance

Pending Legislation: Bill Would Impose Big Penalties for Misclassifying Employees as Independent Contractors

A bill pending in the state legislature would crack down on employers that intentionally misclassify employees as independent contractors in order to avoid unemployment insurance responsibilities. The measure, A.B. 2186, authorizes the Employment Development Department to assess a penalty of $25,000 against any employer who willfully, purposefully, or intentionally misclassifies an employee as an independent contractor. And a penalty of $50,000 could be imposed if the employer willfully, purposefully, or intentionally misclassifies more than one employee as an independent contractor and there’s evidence that such misclassification is a pattern or practice.

As always, we’ll keep you updated on the status of employment-related measures on the table in Sacramento including this bill.

The HR Management & Compliance Report: How To Comply with California Wage & Hour Law, explains everything you need to know to stay in compliance with the state’s complex and ever-changing rules, laws, and regulations in this area. Coverage on bonuses, meal and rest breaks, overtime, alternative workweeks, final paychecks, and more.

Additional Resources:

“Employee or Independent Contractor? Hiring and Classifying Contract Workers in California” 

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