San Diego Employee Misclassification Lawyer
Employers are, understandably, concerned with maximizing their profits. Unfortunately, some are less honest than others in how they achieve that goal. One way that many employers try to improve their bottom line is at the expense of their employees. These companies may try to reduce their payroll tax obligation by deliberately misclassifying employees as independent contractors, or they may try to avoid paying legally mandated overtime by misclassifying regular employees as executives, administrators, or professionals.
Calling Employees Independent Contractors
An employee who is on the books of a company as a 1099 independent contractor has no payroll deductions. Independent contractors are responsible for paying all their own taxes, while the employer escapes their legal obligation to pay Medicare, Workers’ Compensation, Social Security, Unemployment Insurance contributions, and other benefits they would normally provide W-2 employees: health insurance, contributions to a retirement plan, overtime pay, and paid vacation and sick time. This makes a big dent in the value of the employees’ compensation, cheats the government out of legitimate employment taxes, and leaves the employee without the benefits that are their right.
There are very specific legal distinctions between an employer and an independent contractor. A contractor works where and when he wishes, is not subject to supervision, and is paid for a completed project, not for the number of hours worked. An employer misclassifying an employee can be fined between $100 to $750 or more for each day the employee was misclassified and can even be sent to jail! And of course they will have to pay the taxes they evaded for each worker.
Misclassifying Regular Employees as Exempt from Overtime Requirements
Employers often try to squeeze as much work out of their employees for the least pay as they can get away with. One way to do this is by misclassifying regular employees as executive, administrative, or professional employees in order to exempt them from being legally required to overtime pay for working more than eight hours in a single day or more than forty hours in a week.
The reality is that adding the terms administrative, professional, or executive to an employee’s official job title might make the employee feel more important, but it does not relieve the employer of the legal responsibility for paying overtime. Whether an employee is or is not exempt has nothing to do with the employee’s assigned title, but depends almost entirely on the employee’s actual function in the company and whether he or she meets certain tests regarding job duties, which are spelled out in federal and state labor law.
Getting Help When You’ve Been Misclassified
In San Diego, with the assistance of the experienced employment attorneys at Bodell Law Group, if you’ve been misclassified by your employer—either being put on the company’s books as a 1099 independent contractor or being classified as an exempt employee to avoid paying you overtime—you may have a very good case to recover damages.
In this shaky economy, many employees tolerate this type of illegal and unethical behavior because they are afraid of losing their job. The law does not, however, allow any form of retaliation against an employee who has made a complaint or initiated a lawsuit for an unfair labor practice. To retaliate would expose the employer to even greater penalties, so this should not be a consideration when deciding to fight for your legal rights. The lawyers at Bodell Law Group are committed to a fair and equitable workplace for all, and will fight for your right to the pay you’ve earned. Call for a free consultation.