Category Archives: Misclassification

Employer Fraud, Misclassification

NEOC Awards Whistleblower Client Misclassified as Independent Contractor

Today’s post comes from guest author Jon Rehm, from Rehm, Bennett & Moore.

I was happy to have the chance to represent Theron Chapman in his whistleblower claim against his former employer, Midwest Demolition. While the Lincoln Journal Star headline of “Man chased from job by manager with stun gun awarded back pay” is catchy, the real story here is that an employee who was fired for complaining of legitimately being misclassified as an independent contractor won some measure of justice from the Nebraska Equal Opportunity Commission.

Mr. Chapman had a legitimate grievance about being misclassified as an independent contractor. Nebraska law explicitly prohibits the type of misclassification that he questioned. In 2010, State Sen. Steve Lathrop, who authored the legislation outlawing misclassification in Nebraska, said in his bill’s statement of intent, as quoted in Truckinginfo: the web site of Heavy Duty Trucking magazine, that:

“When a contractor misclassifies an employee, the employee is ineligible for unemployment and workers’ compensation benefits, loses labor-law protections and does not receive employer-provided health insurance. Misclassification creates an unfair advantage to unscrupulous contractors who are able to outbid law-abiding employers who must take into account the payment of taxes and insurance premiums when bidding for jobs. The State’s loss in revenue negatively affects the funding of essential programs such as unemployment benefits.”

The deeper story here is that people on the margins of the workforce can sometimes vindicate their rights in the workplace. My client was hired through a job lottery at the People’s City Mission, a homeless shelter, here in Lincoln. People in his situation are vulnerable to abuse in the workplace. Not every instance of bad behavior by management is legally actionable, but that is true from the executive suite to low-wage workers like my client. But fair-employment laws can protect people who are being abused in the workplace and do sometimes provided protections to the people who need them the most.

Misclassification

The Vanishing Concept of a Job

Today’s post comes from guest author Jon Gelman from Jon Gelman, LLC – Attorney at Law.

While reviewing some historical cases today, I realized that what is missing from the workplace is the concept of “a job.” America’s economy has dramatically changed, and so have jobs that were once available its workforce.

Even clearer is the fact that the concept of a job has disappeared. The idea of getting up in the morning and going regularly to a job has even vanished. The evolution changed slowly with the young generation claiming that a job cycle transformed from a lifetime position to one lasting two years. Then the next stage in the evolution occurred, where the employee became a transient worker and daily the job changed and no stable employer really exists.

This evolution has eroded the underlining framework of a functional workers’ compensation program and the delivery of benefits. The injured worker becomes lost to the system, and a safe and secure workplace becomes an illusion. Lost in the complexity is the adequate reporting of accidents and occupational disease, and the ability to accurately folllow the evolution of latent diseases and medical conditions.

“A new trend in the U.S. labor market is reshaping how management and workers think about employment, while at the same time reshaping the field of occupational safety and health. More and more workers are being employed through “contingent work” relationships. Day laborers hired on a street corner for construction or farming work, warehouse laborers hired through staffing agencies, and hotel housekeepers supplied by temp firms are common examples, because their employment is contingent upon shortterm fluctuations in demand for workers. Their shared experience is one of little job security, low wages, minimal opportunities for advancement, and, all too often, hazardous working conditions. When hazards lead to work-related injuries, the contingent nature of the employment relationship can exacerbate the negative consequences for the injured worker and society. The worker might quickly find herself out of a job and, depending on the severity of the injury, the prospects of new employment might be slim. Employerbased health insurance is a rarity for contingent workers, so the costs of treating injuries are typically shifted to the worker or the public at large. Because employers who hire workers on a contingent basis do not directly pay for workers’ compensation and health insurance, they are likely to be insulated from premium adjustments based on the cost of workers’ injuries. As a result, employers of contingent labor may escape the financial incentives that are a main driver of business decisions to eliminate hazards for other workers.”

Click here to read “At the Company’s Mercy: Protecting Contingent Workers from Unsafe Working Conditions”