Employers Beware: Governor to Focus on Rooting Out Misclassification of Independent Contractors
Figuring out whether you can lawfully classify a worker as an independent contractor can be complicated. There are different standards for different laws. In Wisconsin, worker’s compensation and unemployment compensation laws each have their own definition of “independent contractor.” There is yet a different test for the purposes of wage and hour laws. Employers may not be aware of all of the applicable tests and, in many instances, misclassify workers who should be considered employees as independent contractors. However, ensuring proper classification of workers is now even more important in Wisconsin.
On April 15, 2019, Wisconsin governor Tony Evers issued an executive order creating a joint task force of leaders from the Wisconsin Attorney General’s office, Department of Revenue and Department of Workforce Development, including that Department’s Unemployment Insurance, Equal Rights and Worker’s Compensation divisions, among others. The task force will “facilitate coordination of investigation and enforcement of worker misclassification” by state agencies. It is expected that this will entail the sharing of information between agencies, the development of recommendations for pooling investigative and enforcement resources and fostering cooperation and participation from district attorneys and federal agencies. The task force will also propose potential legislative and administrative changes in its annual report to Governor Evers.
All of this points to increased scrutiny of independent contractor relationships going forward. Therefore, now is the time for Wisconsin businesses to review current arrangements to determine whether they are in fact properly classifying workers.
