FOR IMMEDIATE RELEASE: 4/30/2018
Office of Attorney General Maura Healey
The Attorney General’s Fair Labor Division
The following are excerpts from the release:
Attorney General Maura Healey today led a coalition of 12 state attorneys
general in filing a brief to the National Labor Relations Board in support of a decision that
misclassification of employees as independent contractors constitutes an unfair labor practice in violation of the National Labor Relations Act.
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“Employers that misclassify their employees cheat local and state governments from
collecting millions in taxes each year and create an unfair playing field for others,” said AG Healey. “I urge the National Labor Relations Board to uphold the decision in this case.”
According to the brief, misclassification is an increasingly common way for employers
to avoid their legal obligations to employees and to unfairly compete in the marketplace.
When employers misclassify their workers as independent contractors, it is significantly
harder for those employees to assert their workplace rights, including protections from wage theft, harassment and discrimination. Misclassified workers are also denied Occupational Health and Safety Act protections, and are unable to form unions, collectively bargain for wages and benefits, or join in concerted efforts to improve conditions in their workplace without fear of reprisal from employers.
Employers that misclassify their workers are also able to avoid paying unemployment
insurance and contributing to the worker’s compensation system, which poses significant cost in terms of lost revenue for state, local, and federal government. According to two studies cited in the brief, Massachusetts loses an estimated $259 million to $278 million annually, $87 million of which is in unpaid unemployment insurance taxes, because of misclassification. In 2015, the Massachusetts Council on the Underground Economy reported recoveries of more than $50 million from employers who misclassified their employees from 2013 to 2015.
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The coalition of state attorneys general submitted today’s brief at the invitation of the National Labor Relations Board. Massachusetts and Pennsylvania led today’s brief, joined by Connecticut, Illinois, Maryland, Minnesota, New Jersey, New Mexico, New York, Oregon, Virginia and Washington.