Creating good jobs means playing by the rules
There are more than 72,000 law-abiding employers here in Iowa. They correctly classify their employees, report quarterly wages and pay unemployment taxes. Yet they’re put at a competitive disadvantage by the employers who skirt the law.
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The chief problem is employee misclassification. It occurs when employers wrongfully treat workers as “independent contractors” or pay the workers “off the books.”
In July 2009, we launched a Misclassification Unit at Iowa Workforce Department to address this problem. The misclassification unit reported recently that:
** 230 employers misclassified 2,602 workers.
** Total unreported wages were $61,073,494.
** Total state unemployment taxes due were $2,081,850.
When the Misclassification Unit finds violators, they collect the unemployment taxes owed and refer the case to the Department of Revenue and to Workers Compensation so that they can collect other taxes owed.
Thanks to these new efforts, we’re leveling the playing field for those businesses that follow the law and ensuring workers get the pay and benefits they deserve. For more information, go to www.iowaworkforce.org/misclassification/.
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