US DEPARTMENT OF LABOR, VIRGINIA EMPLOYMENT COMMISSION SIGN AGREEMENT TO PROTECT WORKERS FROM MISCLASSIFICATION


WHD News Release: 06/16/2016
Release Number: 16-1214-NAT
Participants: U.S. Department of Labor’s Wage and Hour Division
Virginia Employment CommissionPartnership description: The U.S. Department of Labor’s Wage and Hour Division and the Virginia Employment Commission signed a three-year Memorandum of Understanding intended to protect employees’ rights by preventing their misclassification as independent contractors or other non-employee statuses. The two agencies will provide clear, accurate and easy-to-access outreach to employers, employees and other stakeholders; share resources; and enhance enforcement by conducting coordinated investigations and sharing information consistent with applicable law.

Background: The division and the U.S. Internal Revenue Service are working with Virginia and 30 U.S. states to combat employee misclassification and to ensure that workers get the wages, benefits and protections to which they are entitled. Labeling employees as something they are not – such as independent contractors – can deny them basic rights such as minimum wage, overtime and other benefits. Misclassification also improperly lowers tax revenues to federal and state governments, as create losses for state unemployment insurance and workers’ compensation funds.

More information on misclassification and the effort are available at http://www.dol.gov/misclassification/.

Back pay a boon for Tyler Middle School workers

December 20, 2015
by Ryan Murphy 

 

 

Randy Tong worked for about a year with Comfort Systems, a heating and cooling subcontractor, to help build the Georgie D. Tyler Middle School in Windsor.

Two years later, he finally got paid.

Tong and hundreds of other workers who were underpaid while working on the Tyler Middle construction job have finally received checks for back pay ordered as a result of a Department of Labor investigation — although some still have complaints about how much they got and how the process was handled.

(Read More) 

Sunshine Week: Beat reporter shines light on schools’ use of federal contracts

By Robert Brauchle

March 16, 2015

 

Reporter Ryan Murphy began 2014 with a tip that Isle of Wight County Schools may have skirted federal regulations in the construction of the new Georgie D. Tyler Middle School.

Using the state Freedom of Information Act to access copies of contracts, emails and bid documents, the Daily Press Isle of Wight County beat reporter found that the school division had omitted wage standards from the construction contract that are required under the federal Davis-Bacon Act. The effect was to lower the cost of construction by underpaying local workers hundreds of thousands of dollars.

“I spent a couple of months digging into the documents and digging into legislation to figure out exactly what had happened,” Murphy said.

Murphy worked with school administrators to get the documents he needed.

(Read More)

Workers will get backpay for Windsor school construction

By Ryan Murphy
November 25, 2014, 9:43 PM | ISLE OF WIGHT

Isle of Wight County Schools will pay backpay for hundreds of workers on a school construction job in Windsor who were shorted after the school system failed to include federal wage requirements in contract documents.

The move comes seven months after a Daily Press investigation revealed that the school system had appeared to violate federal law by failing to include the pay rate clauses. The school system used $7.5 million in federally subsidized bonds for the job, which came with strings attached, including paying workers on a pay scale based on local prevailing wages.

The Labor Department opened an investigation into the issue in May. A department spokeswoman said Wednesday that the investigation was still open.
The Isle of Wight School Board approved an order at Monday’s work session to take steps to comply with the federal law, called the Davis-Bacon Act, and to compensate construction workers for the difference between what they were paid and what federal law said they should have been paid.

(Read More)

VA Governor Signs Executive Order Establishing Inter-Agency Task Force on Worker Misclassification

Governor Terry McAuliffe has signed Executive Order 24 establishing an interagency task force on worker misclassification and payroll fraud.

“Every Virginian who works hard and follows the rules should get the pay and benefits that they deserve,” said Governor McAuliffe “This executive order will begin a process to ensure that employers throughout the Commonwealth follow the same rules when it comes to benefits and pay for their employees.”

The text of executive order number 24 is as follows:

 Importance of the Issue

The misclassification of employees as “independent contractors” undermines businesses that follow the law, deprives the Commonwealth of millions of dollars in tax revenues, and prevents workers from receiving legal protections and benefits.

A 2012 report of the Joint Legislative Audit and Review Commission (JLARC) found that one third of audited employers in certain industries misclassify their employees. By failing to purchase workers’ compensation insurance, pay unemployment insurance and payroll taxes, or comply with minimum wage and overtime laws, employers lower their costs up to 40%, placing other employers at a competitive disadvantage.

(Read More)

Virginia Is for Compliers: State Can Now More Easily Pursue Misclassification, Subcontracting Violators

Virginia’s penalties for misclassifying workers in order to avoid paying insurance costs got a boost this month thanks to a new law.  The Virginia Workers Compensation Act made it easier for the state to take action against violators, according to Virginia Workplace Law:

The civil penalty is now up to $250 per day for each day of noncompliance, subject to a maximum penalty of $50,000, plus collection costs.”  The VWCA requires every business owner with more than two employees (a part-time worker is counted as one employee) to have coverage for such worker.

Language in the law will curtail unscrupulous employers from rebranding their employees as independent contractors, the Workers Compensation Commission said:

“Employers should also be aware, designating a worker as an ‘independent contractor’ does not necessarily mean they are not an employee.  Workers’ compensation looks to whether the business exerts control over the manner and means of how the work is performed. In the event of a claim, the facts of the work circumstances will determine if the individual is covered for workers’ compensation, regardless of payment on a 1099 designation.”

(Read More)