The cost of correcting a misclassification in terms of additional unpaid wages, overtime wages, taxes, insurance premiums, potential penalties and interest only increases with time, so it pays to be proactive!
Because classification decisions impact several different aspects of your working relationships, correcting a misclassification is likely to involve a number of different regulatory agencies. Not all regulatory agencies respond to misclassification in the same way, so you will need to contact each agency individually.
Usually, your list of agencies to contact will include:
1. Internal Revenue Service
. Under certain circumstances, employers of misclassified employees may qualify for relief from employment tax liability.
2. Department of Revenue
, regarding personal income taxes, transit taxes, withholding
3. Employment Department
, regarding employment taxes
4. Workers' Compensation Division
, regarding workers’ compensation coverage
Depending on your specific circumstance it may also be necessary to contact relevant licensing boards, such as:
1. Construction Contractors Board
2. Landscape Contractors Board
3. Health Licensing Board
If you are an employee being treated as an independent contractor, you should know that there are limitations on the time available to file a claim or complaint regarding matters like unpaid wages, benefits, minimum wages, overtime and discrimination. Contact the Bureau of Labor and Industries
for additional information.