PROTECTING INDEPENDENT CONTRACTORS AND THEIR CUSTOMERS

Lily Quezada, The Garrity Group Public Relations

President Obama’s 2015 fiscal year budget proposal includes $14 million for the U.S. Department of Labor to provide state grants to investigate independent contractors and hire 300 new federal investigators across the United States. The objective is to target employers and industries.
The federal government has also allocated $25 million for a joint IRS-Department of Labor initiative that is making it harder for independent contractors and their clients to work together. The government is targeting small businesses in particular because they’re easier to prosecute. They allege that employees are being paid as contractors to evade taxes, usually without a factual basis. In fact, when it comes to paying taxes, contractors have virtually the sme compliance rate as employees, and often pay more taxes because they have fewer pre-tax deductions.
In addition, federal agencies have joined forces with more than a dozen states to investigate and prosecute independent contracting arrangements.
At the state level, more than half of all states have either proposed or approved new laws restricting independent contracting arrangements, and some have gone so far as to create the presumption that every worker is an employee until proven otherwise. New York, for example, will no longer apply a common law test across all industries operating in the state to determine worker classification. Now, the state will require more exacting standards for establishing contractor status for drivers of commercial vehicles with a gross vehicle weight rating of more than 10,000 pounds – all in an effort to target independent contractors operating in the state.
Several other states have also formed statewide task forces to increase audits and prosecutions of independent contractors and their clients.
These actions, supported by unions facing declining membership and states desperate for new revenues, are based largely on misinformation about the individuals who are willingly exercising their right to work for themselves. They ignore the vital role that independent contracting plays in the U.S. economy, creating new jobs and providing services more efficiently and effectively than would be possible under a different structure.
Help us protect the right of independent contractors to choose a way of life that works best for them, and the right of businessmen and women to pursue a business model that creates jobs and keeps America competitive.
Join the Fight! Become a member of It’s My Business today. Please go to ItsMyBusiness.com to sign up and learn more about how you can help protect your livelihood.