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Update: U.S. Department of Labor Increases Pressure to Reclassify Independent Contractor Workers



byM. Christine Carty
Schnader Harrison Segal & Lewis LLP - New York Office

June 15, 2012

Previously published on June 2012

In September 2011, the U.S. Department of Labor announced a joint initiative with the Internal Revenue Service (“IRS”) and 11 states1 to share information and “coordinate law enforcement” for the purpose of ending “the practice of misclassifying employees in order to avoid providing employment protections.” The joint enforcement program was almost immediately followed by the announcement by the IRS of its Voluntary Classification Settlement Program (“VCSP”). VCSP is a program that allows companies the IRS accepts for participation to reclassify workers as employees for employment tax purposes prospectively and to receive 90 percent amnesty on past due employment taxes, with no interest or penalties. We reported and commented on these developments in an Alert in October 2011. What has been the effect of the implementation of these programs over the last nine months?


 

The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.
 

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