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New York Teams-up with the U.S. Department of Labor to Crack Down on Independent Contractor Misclassification

In their continued efforts to crack down on the misclassification of independent contractors, and the resulting federal and state wage and hour violations, the New York State Department of Labor and the New York Attorney General’s office have partnered with the United States Department of Labor (“US DOL”).  New York is the 15th state to sign a memorandum of agreement with the US DOL agreeing to share information and coordinate enforcement efforts.  See US DOL News Release athttp://www.dol.gov/opa/media/press/whd/WHD20132180.htm.

With the combined resources of these state and federal agencies, employers should expect more frequent audits and be prepared to withstand significant scrutiny of their independent contractor designations.  Accordingly, as we approach the beginning of a new year, employers should take this opportunity to review their independent contractor relationships and ensure that they are appropriately classified.  As a reminder, misclassification may result in significant damages including unpaid wages, unpaid overtime, liquidated damages, interest, and attorney’s fees.

Employers may also incur the cost of defending against individual claims and potential class actions.  In addition, employers may be fined or incur penalties for violations of applicable federal and state labor laws and for failure to pay applicable federal, state, and local taxes.

Copyright © 2020, Sheppard Mullin Richter & Hampton LLP.National Law Review, Volume III, Number 337

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About this Author

Lisa Lewis, Legal Specialist, Sheppard Mullin,Labor, Employment, special counsel
Associate

Lisa Lewis is a special counsel in the Labor and Employment Practice Group in the firm's New York Office.

Areas of Practice

Ms. Lewis is experienced in representing employers in a variety of employment-based matters in both judicial and arbitral forums, including disputes relating to breach of restrictive covenants and employment agreements, misappropriation of trade secrets, discrimination and harassment allegations, and wrongful termination.  Ms. Lewis also counsels employers on labor and employment issues, including wage and hour matters, personnel...

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