Connecticut authorities recently issued “stop work” orders to 27 firms working at construction project sites in Stamford for misclassifying workers during the period of Jan. 9 to March 14.
Connecticut Department of Labor’s Division of Wage and Workplace Standards said these construction firms misclassified their employees to avoid their employer obligations.
Authorities said the stop work orders were levied against companies that misclassified workers as independent contractors with the intent of avoiding their obligations under federal and state employment laws covering such matters as workers’ compensation, unemployment taxes and payroll reporting.
Stop work orders result in the halting of all activity at a cited company’s worksite, as well as a $300 civil penalty for each day the company does not carry workers’ compensation coverage as required by law.
In the past 12 months the state agency has inspected 108 construction projects and reviewed the records of 299 contractors. Approximately 199 stop work orders have been issued during this time, with 92 identified as out-of-state contractors, according to authorities. Since October 2007, a total of 898 stop work orders have been issued with $600,000 collected in civil penalties for the misclassification of workers.
Additionally, referrals have been made to the Department of Revenue Services and the Labor Department’s Tax Division audit unit for further investigation.
“Some employers will misclassify workers as independent contractors with the intent of avoiding their obligations under federal and state employment laws covering such matters as workers’ compensation, unemployment taxes and payroll reporting,” Connecticut State Labor Commissioner Sharon Palmer said.
“Unfortunately, when an employer fails to pay for the proper coverage for injuries suffered on the job, and a worker gets hurt, the state’s taxpayers ultimately foot the bill.”