Minnesota Misclassification Crackdown Gets Results
Because of an absence of federal action on the problem of rampant worker misclassification in construction, we continue to track the progress of states across the nation that are trying to deal with what's been called “a cancer” in the industry. Lawmakers in Minnesota have gotten particularly aggressive, pushing a registry for subcontractors that can be easily checked and then revoking licenses of contractors who don't comply.
Via Jonathan Barnes at the Engineering News-Record:
“After some success with the new effort, the Minnesota legislature recently extended the state's Contractor Registration Pilot Program for another year, saving it from expiring on June 30 as it was set to do, and extending its life until at least June 30, 2015.
“In place since late in 2012, the program is administered by the Minnesota department of Labor and Industry, and has a scope that is as broad as its details are specific. From mid-2012 to the end of 2013, 12,198 contractors registered with the Dept. of Labor & Industries. Using the information, the department entered into 80 registration enforcement orders under classification statutes and rules. State officials revoked licenses from nine contractors.
“The program is intended to identify all individuals and firms providing building construction and improvement services in the state, and to ensure that workers are classified appropriately. Minnesota legislators have the lofty goal of bringing all contractors in the state into compliance with state laws, and if they can do so, they might be the first state in the nation to successfully do so.”
An in-depth evaluation of the program showed that in the year 2013, the state “assessed $721,500 in penalties, staying 599,750 of those penalties, leading to a net collection of $121,750 in civil penalties.”
You can read that in-depth analysis of the Minnesota worker misclassification program and let us know if this type of registry would be helpful in your state.