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Misclassification: Your $358,675 Problem

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Misclassification: Your $358,675 Problem

Misclassification: Your $358,675 Problem 2560 1707 Alicia East

Accurate worker classification is important for any company but those with a contingent workforce are especially vulnerable to making missteps. It’s a topic the Biden administration is paying attention to as well. The administration’s recent decision to rescind the “Worker Classification Rule” makes it easier for workers to argue for minimum wage and overtime protections/compensation.

Big company missteps=Big headlines

You’ve probably seen employee misclassification news about the big companies like Uber and Lyft. With the big headlines, you’ll find big fines: often in the multimillions. But while it may be tempting to think of this as a big company problem, it’s not true.

Think misclassification woes only happen to the big kids? Think again.

You might see headlines about worker classification missteps from brands you recognize, but between increasingly-savvy workers and a Democratic-led administration, the smaller companies are at risk too. Small companies are vulnerable to big problems, too. For example, this at-home healthcare services provider was recently found responsible for over $358K in back wages.

The Bottom Line

It just isn’t worth it to try to avoid the rules or get away without knowing them. You can be held responsible whether you’re a big company or a small one. Between savvy workers and a worker-friendly administration highly focused on worker classification, paying close attention to accuracy pays dividends.