Tuesday, April 27, 2010

Connecticut proposes to increase fines for misclassification of employees

Legislation implementing recommendations of Connecticut’s Joint Enforcement Commission on Worker Misclassification has passed both houses as of April 21. House Bill 5204 proposes to increase civil penalties for violators from $300 per violation to $300 a day per violation. Connecticut law provides that an employer that misrepresents either the number of employees or casts them as independent contractors to defraud or deceive an insurance company to pay lower workers’ compensation insurance is guilty of a class D felony and subject to a stop work order. H.B. 5204 would apply the same penalty if an employer defrauds or deceives the state in the same way. The bill increases the penalty for violations by specifying that each day of the violation constitutes a separate offense. H.B. 5204 also specifies that any employer who is fully insured for workers’ compensation and fails to pay the required state assessments for administration of the Workers’ Compensation Commission and for the administration and payment fund of the Second Injury Fund would be guilty of a class D felony and subject to a stop work order.

The legislation follows a March 17 announcement by Connecticut attorney general Richard Blumenthal in which he proposed measures to crack down on companies that misclassify employees as independent contractors, called for the increased penalty and criminal sanctions, and recommended joint investigations of misclassification complaints with other state agencies. The Joint Enforcement Commission, co-chaired by Blumenthal and acting labor commissioner Linda Agnew, has been investigating employee misclassification for the past year. If enacted, the changes would take effect on October 1.

No comments:

Post a Comment