An employer and its staffing company will pay $1.1 million in back wages and another $1.1 million in damages to resolve U.S. Department of Labor (DOL) findings that they intentionally misclassified workers as independent contractors.
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Force Corp., a construction company, created AB Construction to provide it with much of its labor. Force Corp., however, prepared and controlled the payroll and payment procedures for both companies, DOL said in a press release.
During an investigation, the department determined that Force Corp. intentionally misclassified most of its employees to avoid paying them overtime and other benefits. In addition, it used a combination of payroll checks and cash to pay the workers straight time when they should have received overtime pay, DOL said.