Govt Moves to 'Crack Down' on Employing Contractors

HopeTracker| President Obama’s 2010 budget assumes that a federal crackdown on companies that regularly hire ‘contractors’ vs employees will yield at least $7 billion over 10 years to federal and state (not in budget) treasuries.

States are also stepping up enforcement on companies who routinely hire ‘contractors’ to avoid paying benefits to people who have desks, phone lines and function for extended periods of time without benefits.

One federal study concluded that employers illegally passed off 3.4 million regular workers as contractors, while the Labor Department estimates that up to 30 percent of companies misclassify employees. Ohio’s attorney general estimates that his state has 92,500 misclassified workers, which has cost the state up to $35 million a year in unemployment insurance taxes, up to $103 million in workers’ compensation premiums and up to $223 million in income tax revenue. via NYTimes