ST PAUL, Minn. — In a conference room on the third floor of the State Capitol, members of the Attorney General’s Advisory Task Force on Worker Misclassification sat down for the first time to dive into an issue that has grown with the gig economy, namely people who appear to be employees but are treated instead as independent contractors.
In the construction trades especially, there are many workers who think they're an employee of a company but learn too late that they're being paid as independent contractors instead. It also pops up often in building cleaning and security service settings.
"If your ‘employer’ says you're not an employee but you're an independent contractor, they can pay you but not take any of the responsibilities that go with the employer-employee relationship and then still try to direct every aspect of your work. That's not fair," Ellison told KARE.
The working group’s goal is to create a blueprint for detecting and reining in such abuse. That will include making recommendations to the legislature and state agencies. The panel includes people from many different perspectives on workforce issues.
"We’ve got a group that includes both workers and employers, business and labor, and we're trying to come to a set of ideas where everybody can prosper, where we have fairness," Ellison explained.
"One of the groups I'm really concerned about is the companies who treat workers fairly. They should not be at a competitive disadvantage because they follow the rules."
One of the overriding themes that emerged in the inaugural meeting was that misclassification doesn't just hurt the workers involved, but also adversely impacts honest employers and taxpayers who have to pick up the tab for injuries on job sites.
"The social contract is built on the fact that employers employ employees and what comes with that is unemployment insurance, Workers Comp, but also just general wage and hour protections, discrimination protections, all those things," Rep. Emma Greenman, the Minneapolis Democrat who co-chairs the task force, told KARE.
"Most folks assume, 'I go to work, and I’m going to get paid at least minimum wage. I go and do a job and if I’m going to get hurt I’m going to have Workers Comp'."
The Attorney General's office and the Minnesota Department of Labor and Industry do have enforcement powers over wage theft, when it can be discovered and proven. Some workers fear coming forward to report abuse, because they don’t want to lose their jobs or worry about being deported if they make waves.
"With vulnerable workers, folks who may not have status they are being misclassified and in some cases that looks like just being paid under the table so it's depriving those workers," Rep. Greenman remarked.
"If you’re in really dangerous job and if get hurt on the job and you're misclassified you won’t have access to Workers' Comp. You also might not have access to health care. Then it becomes not just an issue for that worker and that family, it becomes an issue across the industry and also for taxpayers and other folks paying for that uncompensated care."
Greenman and Ellison both stressed that some of the misclassification is an honest misunderstanding of how Minnesota’s labor laws work. In those cases government intervention is more of an instructional nature.
"We don't really want a lawsuit. We want people to comply with the law! And a lot of businesses do, so we think the rest should," Ellison remarked.
At the same time this task force is working, the Office of the Legislative Auditor is reviewing whether current laws are adequate to deal with worker misclassification. Representative Greenman says it's not just about passing tougher laws, but also about making sure state agencies have the resources they need to tackle these problems.
Task Force members
Co-chair: Rod Adams, Executive Director, The New Justice Project
Co-chair: Rep. Emma Greenman, MInnesota House of Representatives
Commissioner Nicole Blissenbach, Commissioner, Department of Labor and Industry
Octavio Chung Bustamante, Marketing Representative, LIUNA Minnesota and North Dakota
Daniel Getschel, Director, Individual Income Taxes & Withholding, Department of Revenue
Melissa Hysing, Legislative Director, MN AFL-CIO
Burt Johnson, General Counsel, North Central States Regional Council of Carpenters
Briana Kemp, Policy Lead, Centro de Trabajadores Unidos en la Lucha (CTUL)
Amir Malik, Compliance Manager, City of Bloomington City Attorney’s Office
Senator Clare Oumou Verbeten, Member of the Minnesota Senate
Evan Rowe, Deputy Commissioner of Workforce Services and Operations, Department of Employment and Economic Development (DEED)
Aaron Sojourner, Senior Researcher, W. E. Upjohn Institute for Employment Research
Brittany VanDerBill, Owner, B. VanDerBill Consulting LLC
Kim Vu-Dinh, Associate Professor, Mitchell Hamline School of Law
Jonathan Weinhagen, President & CEO, Minneapolis Regional Chamber of Commerce