HR Management & Compliance

California Joins With DOL to Fight Independent Contractor Fraud; Pacts Also Signed By 11 Other States

California is the most recent state to enter into a pact with the U.S. Labor Department aimed at cracking down the improper classification of employees as independent contractors.

Nancy J. Leppink, deputy administrator of the U.S. Department of Labor’s Wage and Hour Division, and California Labor Commissioner Julie A. Su announced their recently signed memorandum of understanding during a joint press teleconference Feb. 9.

“This memorandum of understanding helps us send a message: We are standing together with the state of California to end the practice of misclassifying employees,” said Leppink. “This is an important step toward making sure that the American dream is still available for workers and responsible employers alike.”

“California is proud to enter into this partnership with the U.S. Department of Labor to work together to attack the problems of the underground economy,” said Su. “Gov. Brown just signed an important law that went into effect on Jan. 1, increasing penalties for willful misclassification. With the Labor Department, we are poised to use all the tools in our arsenal to lift the floor for hardworking employers and employees throughout the state.”

California is the 12th state to sign such a pact. Colorado, Connecticut, Hawaii, Illinois, Maryland, Massachusetts, Minnesota, Missouri, Montana, Utah and Washington have signed similar agreements. More information is available on the U.S. Department of Labor’s misclassification Web page at http://www.dol.gov/misclassification/.

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