An article in the Seattle Times today discusses Congressional hearings on independent contractors who are treated like employees. The goal seems to be to get a better understanding of why these “employees” are being classified as independent contractors. The hearings look specifically at the construction industry which notoriously uses independent contractors but treats them as employees by directing them when to work and how to perform the work. Some companies are intentionally using this mechanism to avoid payroll taxes while others view this as a practical way to staff projects for seasonality. Congress is looking to create enforcement mechanisms and encourage reporting of misclassification. Given this crackdown, if you’re using independent contractors, in the construction industry or otherwise, make sure you understand the independent contractor classifications and are properly categorizing them.

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