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He noted, however, how subcontractors working on a downtown building project, were exposed by his organization for misclassifying and not paying his workers.
So it would seem a natural fit for employers to protect themselves with employment practices liability insurance coverage, specifically wage-and-hour policies that protect them from errors like misclassifying employees.
Labor Secretary Hilda Solis said in a news release that the purpose of the MOUs is to "send a coordinated message: We're standing united to end the practice of misclassifying employees, [and w]e are taking important steps toward making sure that the American dream is still available for all employees and responsible employers alike" (Labor Dep't Wage and Hour Division news release 11-1373-NAT (9/19/11)).
The IRS estimates that companies underpay approximately $14 billion annually by misclassifying employees as independent contractors.
A charge of misclassifying workers is not something any employer wants to face, as software giant Microsoft learned in 1999.
Examples of non-compliant workers' compensation coverage include working without workers' compensation, under-reporting payroll (such as paying employees in cash instead of by check from payroll), and misclassifying employees in order to receive a lower workers' compensation rate.
Misclassifying employees as independent contractors is a constant temptation to employers, who then avoid having to collect and pay income, Social Security, Medicare, and unemployment taxes on the employees' income.
We have learned that Chinese hardwood plywood importers have been tryng to avoid tariffs by misclassifying their hardwood plywood, and we appreciate your work with Customs to look into this.
In recent years, the Congress has become increasingly concerned that federal agencies are misclassifying information.
In 2000, the hospital provided the county with blueprints of the building, which demonstrated that the county had been misclassifying the building's construction type.
The district has been criticized recently for artificially lowering its dropout rate through misclassifying how students left school.
The case raised the awareness of the significant exposure employers face from misclassifying employees.