Contract Workers Organize Protests

From the New York Times: “[The worker] and his colleagues represent a new workers’ grievance: the growing gulf between contract employees’ pay, benefits and protections and those of permanent staff workers. The issue has become so charged that it has led to a prolonged sit-in . . . . Unlike their regular counterparts . . . they start at the bottom of the wage scale and remain there. They receive fewer health care benefits and less unemployment insurance, and they rarely have the shield of a union.”

The Times article isn’t about America. It’s about South Korea. But it could be about America, because as previously noted, American employers sometimes incorrectly label employees as contract employees or independent contractors.

It’s difficult to know how widespread an American problem it is, but it’s probably not an overstatement to say that most employers have contract employees and independent contractors, for whom taxes aren’t withheld, health insurance and profit sharing aren’t provided, and other benefits and perks aren’t available.

This becomes a legal problem when the contract workers or independent contractors are, in fact, employees. Employers who mislabel workers in this way are, in a sense, playing chicken with the Internal Revenue Service, Department of Labor and other government agencies.

If workers called contract employees are coming to work every day for the same employer and doing the work of workers called employees, they are most likely employees and should be treated accordingly. I don’t know whether contract workers or independent contractors in the U.S. will organize protests, but they could file suit. If they’ve been misclassified, an employer could owe a pretty penny in back taxes and possibly back pay. If you have workers who fall into both categories, get some legal advice to see if everything’s okay or if changes need to be made.