1099 Risk Blog

Misclassification Epidemic: Part 2

The IRS was alerted to a growing epidemic of worker reclassification by a Treasury Department report issued last month. In our last blog post on misclassification, we discussed why employee reclassification was on the rise in America. In the second part of this short series, we will look at...

Read Post >

Independent Contractor Classification Tip #6

Here's our next independent contractor classification tip #6:

"Re-assess compliance with every new assignment or, at a minimum, annually." 

The only way to ensure compliance is maintained is to re-assess, re-assess, and re-assess. A simple change in any of the three control factors, such as management oversight when changing to a new project, can disqualify a previously compliant contractor.

Read Post >

Misclassification Epidemic: Part I

Worker misclassification, and the process by which the IRS identifies and handles such misclassifications, was highlighted by the Treasury as a critical issue in a report issued last month. The report’s title says it all: “While Actions Have Been Taken to Address Worker Misclassification, and Agency-Wide Employment Tax Program and Better Data Are Needed.”  The last review of the impact of misclassification (the improper assignment of employees into 1099 independent contractor status) dates back to 1986, and thus the IRS does not have a grasp on exactly what damage . . .

Read Post >

Staffing Alliance Offers Revenue Channel for Battered Industry

The staffing industry is the hardest hit sector in America's economic downturn -- according to Staffing Industry Analysts, employment is off by over 22% -- but reaching into new and growing markets may be the key for staffing firms to diversify and regain their secure footing. According to the twitterstream, the word of the day at today's Staffing Industry Executive Forum was "nichey."  Topics of discussion ranged from diversity and government contracts to the dizzyingly complex and risky independent contractor segment, as top staffing executives explored ways to offer new . . .

Read Post >

Healthcare Workers Bring Suit Alleging Misclassification

Healthcare workers that were classified as independent contractors by the Delta-T Group filed a lawsuit on February 17th claiming they were misclassified, according to a news item in MSNBC today. If the court agrees with their position -- that they should have been classified as employees -- then they have been unjustly denied overtime compensation, unemployment, benefits, payroll taxes, and worker's comp. The company could be forced to

Read Post >

Contractor Classification Tip #5

Here's the next independent contractor classification tip in our series. Tip #5: 

Use the right engagement method.

After you've accurately assessed the status of your independent contractors, you must select the correct engagement method for your compliant and non-compliant contractors. To accurately assess but then incorrectly engage contractors defeats the purpose of doing contractor compliance in the first place, but we're surprised how often we encounter this practice.  Engage non-compliant contractors . . .  

Read Post >