DOL and IRS Join Forces to Combat Independent Contractor Misclassification

Employment Attorney Bob SheaBy: Bob Shea

The U.S. Department of Labor (“DOL”) and the Internal Revenue Service recently announced that the two agencies have signed a memorandum of understanding to “improve departmental efforts to end the business practice of misclassifying employees in order to avoid providing employment protections.” In addition, labor secretaries and other agency leaders of eleven states, including Massachusetts, have signed agreements to share information and coordinate efforts to crack down on independent contractor misclassification. Visit DOL for the full press release.

Many Massachusetts businesses utilizing independent contractors have already faced increased enforcement efforts and private lawsuits in recent years as a result of the Massachusetts Independent Contractor Law, arguably the toughest such law in the nation. The law is analyzed in this article. There are bills pending before the Massachusetts legislature that would address perceived harsh and unintended consequences of the Massachusetts law (for example, Bill H. 1412), but the momentum appears to be towards even more aggressive efforts against the use of independent contractors.

For questions regarding the Massachusetts Independent Contractor Law, please contact Bob Shea. Please visit our resources page for more information on our employment practice.

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