Introduction Of The Employee Misclassification Prevention Act Of 2008
Madam Speaker, along with my colleagues Congresswoman Lynn Woolsey, Chairman George Miller, Congressman Mike Michaud, Congressman McDermott and almost all of the Democratic Members of the Committee on Education and Labor, I rise today to…
Madam Speaker, along with my colleagues Congresswoman Lynn Woolsey, Chairman George Miller, Congressman Mike Michaud, Congressman McDermott and almost all of the Democratic Members of the Committee on Education and Labor, I rise today to introduce the Employee Misclassification Prevention Act of 2008, EMPA.
The egregious practice of misclassifying workers as independent contractors needs to end. EMPA is pro-employee, pro-employer and pro- taxpayer. The bill will protect employee benefits, remove incentives for employers to misclassify their workers, and ensure that bad employers don't line their own pockets with unpaid payroll taxes.
In the last decade we have seen a questionable increase in the amount of individuals classified as independent contractors. In 1984, which was the last time a comprehensive misclassification study was conducted by an oversight agency on this issue, the Internal Revenue Service (IRS) estimated that 15 percent of employers misclassified 3.4 million workers as independent contractors. As a result, $1.6 billion or $2.72 billion in inflation-adjusted 2006 dollars in Social Security, unemployment and income taxes was stripped from the hands of the Government and went into the pockets of tax evaders. Furthermore, the 3.4 million workers who were misclassifed were stripped of many of their basic, but essential, employee rights.
In some cases, classifying an individual as an independent contractor is quite right and quite appropriate. If someone is retained for a limited purpose, usually for a limited time, to do a specific job function for an employer, it is quite necessary and appropriate that that person not be treated as an employee for reasons of flexibility, and for reasons of fair compensation.
However, when an individual is considered an independent contractor by their employer, but is told what to do. has no discretion over how to conduct the affairs of the business, and whose compensation is fixed and set by the employer, it is our duty as Members of Congress to protect this employee's rights under Federal law.
There are millions of workers, who mow lawns, drive trucks, work in garment linen factories, and serve food in restaurants that I would consider an employee; nonetheless, these hardworking individuals are exploited and misclassified by their employers seeking to evade paying taxes. If any American worker is told what to do, when to do it, how much money they are going to make, what the work rules are, what they can and cannot do by their employer then the law should require they be classified as an employee and receive all of the benefits of the 40- hour work week, as well as worker safety protections, pension and healthcare protections and other worker protections provided to them under Federal law.
I encourage everyone to join me, my cosponsoring colleagues, as well as the AFL-CIO. Change to Win, United Brotherhood of Carpenters, International Brotherhood of Teamsters, the Laborers International, UNITE HERE, the National Employment Law Project, and others and support EMPA to protect workers across the country from employers who are only interested in making a profit for themselves at the expense of the American workers and taxpayer.