The Kansas Department of Labor (KDOL) and Gov. Laura Kelly announced actions to prevent worker misclassification.
Worker misclassification is when an employer incorrectly classifies workers as independent contractors rather than employees.
KDOL’s Unemployment Insurance Tax/Employer division is hiring additional auditors to continue its work to prevent, detect, and investigate this type of fraud. The agency will also raise public awareness by sharing educational materials on social media.
“Worker misclassification is an issue of fairness to workers, who deserve benefits they’ve rightfully earned, and to the honest businesses that do right by their employees,” Governor Kelly said.
Kansas employers are required to report wages to the Department of Revenue and the Department of Labor for the purposes of withholding tax, unemployment tax, and workers’ compensation. The intentional misclassification of workers is illegal and constitutes tax and insurance evasion.
Kansas law imposes penalties against employers who intentionally misclassify a worker as an independent contractor to avoid paying these taxes.
Officials say that misclassified workers lose essential protections and rights they would otherwise be entitled to in a traditional employee/employer relationship, including minimum wage requirements, overtime pay, workers’ compensation, unemployment insurance, and anti-discrimination laws.
“Worker misclassification can lead to unfair competition among law-abiding businesses. A business that attempts to defraud the system cheats workers of vital benefits and adversely affects other businesses,” according to Labor Secretary Amber Shultz.
Below are additional ways Kansans can help combat misclassification:
Employers: For information about correctly classifying workers, refer to KDOL’s Employer Toolkit at www.dol.ks.gov/employers or call (785) 296-5027.
Employees: Concerns or tips regarding misclassification can be reported by email to KDOL.uitax@ks.gov or by phone at (785) 296-5027.
To learn more about worker misclassification, visit www.dol.ks.gov/employers and click Worker Misclassification.
