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Why Does Proper Classification Matter?

How businesses classify their workers is an important concern for Oregon employers, workers, and state agencies. In Oregon, independent contractors are not considered employees of businesses and are not subject to employment laws, rules or protections provided to actual employees. Anyone that hires workers should understand the differences between employees and independent contractors in order to ensure that all requirements involved with hiring workers are followed. Improper classification of workers can lead to unfair wage practices, increased business taxes, wrongful tax avoidance, and underfunded worker benefits.

Oregon's Interagency Compliance Network

Oregon’s Interagency Compliance Network (ICN) is a group of seven state agencies dedicated to promoting proper classification of employees, voluntary compliance with tax and employment laws, and providing education to the public. The agencies included in the ICN are the Oregon Employment Department, Department of Revenue, Department of Consumer and Business Services, Bureau of Labor and Industries, Construction Contractors Board, Landscape Contractors Board, and the Department of Justice. These agencies frequently communicate and share information with each other to collaborate on cases and provide information about compliance issues to Oregonians.

Potential Risks of Non-Compliance

Businesses that do not comply with employment law could be subject to penalties from multiple state agencies. These penalties include additional tax assessments, financial penalties and interest, suspension of licenses, civil penalties, and incarceration. If you have questions about what you can do to make sure you or your business is compliant, please contact the appropriate agency listed below.​