Compensation Management News
August 22, 2016
An employer and its staffing company will pay $1.1 million in back wages and another $1.1 million in damages to resolve U.S. Department of Labor (DOL) findings that they intentionally misclassified workers as independent contractors.
Force Corp., a construction company, created AB Construction to provide it with much of its labor. Force Corp., however, prepared and controlled the payroll and payment procedures for both companies, DOL said in a press release.
During an investigation, the department determined that Force Corp. intentionally misclassified most of its employees to avoid paying them overtime and other benefits. In addition, it used a combination of payroll checks and cash to pay the workers straight time when they should have received overtime pay, DOL said. The department also determined that the employer kept inadequate and inaccurate time and payroll records.