BY LAURA A. FORTMAN AND JOHN C. ROHDE – SPECIAL TO THE PRESS HERALD
December 23, 2021
Misclassification deprives employees of needed protections, puts other employers at a disadvantage and affects taxpayers as well
A recent court case (“Scarborough roofing contractor found not guilty in death of worker,” Dec. 9) has raised the issue of worker classification. We, along with Maine State Chamber of Commerce President Dana Connors and Maine AFL-CIO President Cynthia Phinney, are writing to explain why the proper classification of workers is so important.
When an individual or business hires another person to perform work for them, that person will either be an employee or an independent contractor. Misclassification occurs when an employer hires an employee but treats them like an independent contractor.
Why does it matter if an employer treats an employee like an independent contractor? There are several important reasons.
• Independent contractors who do not purchase workers’ compensation insurance do not have access to lost wages and medical benefits under the Workers’ Compensation Act if they are injured on the job. An employee misclassified as an independent contractor can file a claim with the Workers’ Compensation Board. However, in addition to showing they were hurt at work, the misclassified employee will also have to prove they were an employee. This almost always means the injured employee’s claim will take longer to resolve.
In the meantime, and maybe permanently if the employer does not have workers’ compensation insurance, an injured misclassified employee will have to find a way to pay for the medical treatment they need. If the injury is serious, they may have to do this without any income.
• Similarly, if a misclassified worker loses their job through no fault of their own and files for unemployment insurance, it will take longer for the employee’s unemployment claim to be resolved.
• Employers that misclassify employees as independent contractors are probably not following federal and state employment laws that regulate minimum wages, overtime, paid leave and safety, among other protections. Misclassified employees may receive less pay than they are entitled to and work in conditions that are not as safe as they should be.
• Misclassification also adversely affects other employers. Employers that properly classify their workers – as the vast majority do – will find themselves at a disadvantage when bidding for jobs or otherwise competing against employers that do not. Employers that follow the law may also pay higher workers’ compensation rates if the pool of workers they are insuring is smaller because their competitors have misclassified their employees.