December 14, 2004

UMass-Harvard study says many area workers misclassified
Posted by deisenhart@bostonworks.com">Douglas Eisenhart at 10:56 AM -

Diane Lewis reports in yesterday's Globe on a new joint UMass-Harvard study that shows that many area workers are misclassified by employers:

Thousands of Massachusetts workers are wrongly classified as self-employed or independent contractors by employers seeking to lower costs, according to a report released jointly today by the University of Massachusetts' and Harvard University's schools of Law and Public Health. Misclassifications enable employers to avoid payroll taxes and such mandated employee benefits as unemployment and workers' compensation insurance.
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The study revealed misclassification is prevalent in a variety of business sectors. For example, 17 percent of all audited employers in transportation and utilities misclassified workers. In addition, 16.1 percent of the firms in education and health services, 14.3 percent of those in information services, 13.5 percent of the employers in professional and business services, and 11.4 percent of those in construction misclassified workers.

Is your company aware of how to proceed in this area? For a discussion of the issues, tips, and a list of helpful links, see attorney Denise Page's article "To employ or to contract, that is the question" from "NEHRA - The Voice of HR" here in the Hiring Hub.

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