Agenda - Council Work Session - 07/28/2026

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HOME - FACTS - TABLES - VIDEOS - INFOGRAPHICS - AGENCIES - RESEARCH Carre, Frangoise. (2015).(In)dependent Contractor Misclassification. Economic Policy Institute. Kev Findine: State -level studies show that 10%-20% of employers misclassify workers independent contractors. High workers' compensation premiums in injury -prone industries such as construction create a financial incentive for employers to hire workers, such as undocumented workers, who will not be covered by workers' compensation. Misclassification weakens the bargaining power of labor in a workplace as contractors are not protected by the NLRA. Misclassification harms employers who properly classify employees as they incur higher payroll costs. Locke, Mandy and Franco Ordonez. ( ; ). "Taxpayers and Workers Gouged by Labor -Law Dodge." McClatchy DC Bureau. Kev Finding: Misclassification allows fraudulent contractors to underbid law-abiding businesses on publicly -funded construction projects, as evidenced by contracts awarded in the economic stimulus following the Great Recession. Williams, Erica; Michael Leachman; Mariana Wallace; and Nicholas Albares. (2015). For States, Inclusive Approach to Unauthorized Immigrants Can Help Build Better Economies. Center on Budget and Policy Priorities. Kev Finding: This report details policies that may benefit immigrants in the labor market. Strengthened labor law enforcement preventing misclassification and wage theft would boost state economies and increase tax revenue. Weil, David. (2015). The Application of the Fair Labor Standards Act's "Suffer or Permit" Standard in the Identification of Employees Who Are Misclassified as Independent Contractors. Wage and Hour Division. U.S. Department of Labor. Kev Finding: This memo details the varying definitions of "employee" that allow misclassification to continue and describes the factors courts have drafted to weigh when considering the employee -employer relationship. Leyh, Chelsea. (2015). "Getting a Fair Shake: Reducing the Perils of Worker Misclassification on Federally Funded Construction Projects." Public Contract Law Journal, 44(2): 307-325. Kev Finding: This study details legal actions against misclassification in construction and the legal precedents they set. Policy recommendations are provided, such as allowing the USDOL and IRS to share information on misclassification cases to reduce their prevalence by eliminating certain employers from the bidding process. Miller, Scott. ( `). "Combatting Wage Theft in Illinois: Administering and Enforcing the IWPCA." The Urban Lawyer, 47(4): 665-716. Kev Finding: This history of Illinois Wage Payment and Collection Act discusses 2010 amendments that made it one of the strongest anti -wage theft laws in the U.S., such as giving IDOL the power of administrative judgment on wage theft claims of $3,000 or less, enabling private or class actions against employers, increased criminal penalties for employers guilty of wage theft (up to a Class 4 felony), and enabling private actions against employers for retaliation. Prakash, Anna and Brittany Skemp. ( ). "Beyond the Minimum Wage: How the Fair Labor Standards Act's Broad Social and Economic Protections Support Its Application to Workers Who Earn a Substantial Income." ABA Journal of Labor & Employment Law, 30(3): 367-388. Kev Finding: Under FLSA, employers act as tax collectors in some capacity by deducting taxes from employee paychecks. This efficiency is lost when employees are misclassified. The lost income tax revenue affects the federal government's ability to fund defense, public aid, disease control, veteran's benefits, and law enforcement. Deductions mandated by FLSA also ensure social programs like Social Security, Medicare, and unemployment insurance. Skinner, Nancy. (2015). "Guest Commentary: Cities Can Play a Role in Stopping Wage Theft." Marin Independent Journal. Kev Finding: Wage theft cheats California taxpayers out of at least $8.5 billion a year in uncollected taxes. 57