Finance News & Insights

Misclassified independent contractors cost firm a cool 149K

Now’s a critical time to be extra careful with invoices for independent contractors.  

The Department of Labor (DOL) is on the prowl for worker misclassification.

One company in California recently learned that the hard way after treating new workers as ICs during a three-month probationary period.

When that period was up, the firm let workers decide whether they’d remain ICs or be brought on as employees.

Not good, the DOL said, since all of the ICs should have been classified as employees.

Now the company has to pay $149,008 in liquidated damages and back wages.

An employee is an employee is an employee

Make sure you and hiring managers are clear on the DOL’s six-point worker classification system.

Before paying ICs, managers need to check that IC assignments don’t trigger employee classification.

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