They sure have gotten cocky, havent they? MTSOs - think theyre above the law. -sm

yep - anon

here's a link, I hope it helps - sm - sssdt

Actually it's a company, not a school. I'll call...sm - Sick N Tired

Email and forward any info to everyone you can...sm - anon

Reporting to IRS - Dee

Good for all of you doing this!!! - Tiredofitall NM

Increased scrutiny by DOL - better watch out!

This is great news! As an UPDATE: To all the MTSOs....sm - Sick N Tired

Careful - Ima MT

Well, excuse me, but I know exactly what the job...sm - Sick N Tired

Pull out some new lines will ya? - Ima MT

OMG, I am not sure of the reason for your animosity.sm - Sick N Tired

Dont pay her any mind - got a screw loose somewhere, - and just trying to start a fight. nm

Ima, if you could contribute some info regarding this issue, it would make - it worth our time to read your posts. nm

...and here comes the management plant. - Predictable as always

We can make DOL"s job easier by leading them - directly to the companies who cheat us. -nm

Bout time, too! "Go sic-em, DOL!" It just cant - happen soon enough for me! -nm

Not an IRS issue. This is an issue for the - Department of Labor.

Yes, this is definitely an IRS issue - as well as DOL

If theyre cheating us and dinging our wages, that - means theyre also getting less tax revenue. nm

(Not to mention all the tax revenue thats being sent - overseas to India!) - nm

Here is why MTSOs that hire Independent Contractors are running scared - Hang on to your hats - it is going to be a bumpy r

Here is why MTSOs that hire Independent Contractors are running scared.

New bill introduced this week.  Could be a law in a matter of weeks. 

On April 22, 2010, a long-awaited bill addressing the issue of misclassification of employees as independent contractors was introduced by the House (Rep. Lynn Woolsey, D-CA) and Senate (Sen. Sherrod Brown, D-OH). The bills, H.R. 5107 and S. 3254, are called the Employee Misclassification Prevention Act (EMPA). They would amend the federal Fair Labor Standards Act to impose strict recordkeeping and notice requirements on businesses with respect to workers treated as independent contractors, and expose such businesses to fines from $1,100 up to $5,000 per employee for each violation of the law.

The purpose of EMPA is to curtail and penalize the practice of many businesses in the United States of misclassifying employees as independent contractors. This practice has reportedly contributed to the “tax gap” at both the federal and state level, as well as a loss of federal and state labor protections for those workers that, by law, should be classified as employees instead of as independent contractors.

EMPA does not prohibit businesses from continuing to use properly classified independent contractors; it only prohibits companies from misclassifying workers as independent contractors when such workers are really employees.

Nonetheless, all businesses would be affected by EMPA, because it imposes upon every company that uses either employees or independent contractors a recordkeeping and a notice requirement. Any business that fails to provide the required notice would be subject to fines, even if its independent contractors are properly classified.

Briefly, if enacted into law as drafted, EMPA would:

• require every company covered by the law to provide a written notice to all workers who perform labor or services informing them that they have been classified as either an employee or “non-employee,” directing them to a Department of Labor Web site for further information about the rights of employees under the law, and informing them to contact the Department of Labor if they have any questions about whether they have been misclassified


• require companies which are now required to keep records of the hours of work and wages of employees to keep comparable records for “non-employees” providing labor or services to the business


• add a new provision making it a “prohibited act” under federal law to fail to accurately classify a worker as an employee (i.e., to misclassify a worker as a non-employee)


• impose upon businesses a penalty from $1,100 to $5,000 per worker for a violation of the notice or recordkeeping requirements or for misclassifying an employee as a non-employee, and


• impose triple damages for willful violations of the minimum wage or overtime laws where the employer has misclassified the affected employee.

In addition, EMPA would direct the Secretary of Labor to:

• establish a misclassification Web site that would enable workers to file complaints online and notify them that employees may have greater rights under state or local laws than under federal law


• amend the Social Security Act to establish penalties for misclassifying employees or for paying unreported wages to employees for unemployment compensation purposes


• authorize the Department of Labor to report misclassification information to the IRS, and


• direct the Department of Labor to conduct “targeted audits” of certain industries “with frequent incidence of misclassifying employees as non-employees.”

The proposed legislation also seeks to pierce the corporate veil of corporations, partnerships, and LLCs owned in whole or part by the worker and used to avoid the issuance of Form 1099s.

EMPA is one of two bills introduced in this legislative term that deal with misclassification of employees. In 2009, the House and Senate introduced the Taxpayer Responsibility, Accountability, and Consistency (TRAC) Act of 2009 (S. 2882 and H.R. 3408). If enacted, the TRAC Act would limit the availability of the so-called “safe harbor” provisions in Section 530 of the Revenue Act of 1978, which has been relied on by many businesses to designate workers as independent contractors for federal employment tax purposes. The TRAC Act also would afford workers the right to petition the IRS for a determination of the worker’s status, and increase penalties of up to $1 million to $3 million for intentional disregard by taxpayers filing incorrect Form 1099s. Both houses of Congress are expected to reintroduce TRAC Act bills in 2010 that are similar or identical to those bills introduced in 2009.

The introduction of EMPA is consistent with the national labor policy of the Obama Administration. The recently released Budget for Fiscal Year 2011 authorized $25 million to the Department of Labor to target employee misclassification through the hiring of 90 additional investigators and 10 additional lawyers to pursue “a joint proposal that eliminates incentives in law for employers to misclassify their employees” and “enhances the ability of both agencies to penalize employers who misclassify.”

 WOW!!!!!!

Things are going to change soon. 

I like it. Now, if they would just pass something - similar with regards to offshoring work!!! -nm

suddenly, it makes sense - sm - sssdt