Is the DOL Finally Moving on Employer Abuses of Independent Contractor Classifications?

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New Orleans   On March 13th the United States Department of Labor (DOL) is taking comments on the ways and means of an almost $2 million dollar survey of over 10,000 workers nationally that they have proposed as part of their so-called Misclassification Initiative.  What they are trying is to suss out through these interviews is how much workers know or don’t know about their employment status in diverse industries when it comes to rights and entitlements depending on the kind of work they do and how to do it.  Much of this survey, along with another report the DOL is scheduled to issue in September of this year, continues to probe the glaringly obvious reality of informal and contingent laborers in the United States whose misclassification as independent contractors robs the state and federal government of billions of dollars of revenue for things like Social Security and health benefits for workers and of course directly exploits the workers by denying them overtime, unemployment, workman’s compensation, and even minimum wages along with other entitlements while employers also shortcut on payroll and other taxes.

            This is good news, bad news.  Good news they are getting on top of their business.  Bad news in the era of neo-liberalism in that the basic design of this “initiative” seems to be to turn more workers into enforcers of labor laws while the DOL passively receives the complaints and posts more abundantly detailed notices and requires employers to pass out more information to workers for such self-enforcement.  This isn’t exactly “blaming the victim,” but in these days of decreasing worker organization, the continuing subtle shift of responsibility for workers ending their victimhood is also falling on them.  Until we are able to create some sustainable alternatives forms of organization that can empower and enable workers to do this collectively, the implicit DOL message to workers is really good luck or good riddance.  Good luck, if employers get cold feet on these scams, which is what the Wall Street Journal hinted in a “Labor Crackdown Heats Up” article on some expensive subcontractor enforcement settlement cases.  Good riddance though is more common since many workers will simply “vote with their feet” and leave such ripoff work situations at the first opportunity afforded by an improving economy.

At Fair Grinds Coffeehouse the vendor for the multiple varieties of cream cheese that we order based on our customer demands for bagel spreads is an independent subcontractor.  We order when we need something, she delivers on her schedule in her containers and based on her recipe.  Often these vendors look at our supplies and fill them based on their assessments and bill us later.  We had to change one, because she couldn’t get around to filling the order on as regular basis as we needed to have the spreads.  Such a worker is a classic independent contractor.

On the other hand I still fume at a job my son took for 6 or 9 months as a delivery courier for a company that contracted to deliver pharmaceuticals to hospitals and nursing homes at all hours of the day.  He was paid a rate set by the company depending on the route.  They picked the orders from their warehouse, but to make that money he showed up with his vehicle, paid his gas (they told him how he could get a business deduction on his taxes), waited sometimes for hours with other drivers to get the orders on shifts that they established, while wearing their t-shirt, and using their scanner on the orders and turning it all back into their warehouse after every shift.  There was no way that he was an independent contractor, but he and his buddies did the work because they needed it or it was a second job or it fit their schedules in peculiar ways, and because the company could get away with it.   He liked the job.  The company even increased his pay because he was good at it, which also made him mostly like an employee.  He left when he got a better job.  He didn’t want the hassle of dealing with the DOL, and it is something we still chew on regularly.  Walmart in Mexico makes their checkers independent contractors.  Employers will get away with anything they can, big or small.

The DOL doesn’t have enough enforcement agents in the Wage and Hour Division, but that’s not really news.  They have never had enough.  Now with each budget cycle they seem to have less and less, even though workers would make more money and the government would do better if there was aggressive or at least accountable enforcement.

Port drivers, who are a target of organizing drives with the Teamsters supported by the labor federation, Change to Win, have been campaigning on this issue for years, particularly on the West Coast in Seattle, Los Angeles, and Bay Area ports.  Unable to dream of proper classification by the DOL, the fight has been for Port Commission to determine that the drivers, often working for only one company and caught on the fixed schedule of the company, are employees through an authority of sorts.  This campaign has been waged for years, but victory continues to be elusive.

Putting the whole burden on workers still seems to send the message to employers no matter some dustups here and there that this kind of wage theft and con game is going to work for many, even if a few get caught and have to pay up.  Let’s hope the DOL figures something out with all of these reports and surveys, but we need to figure out a way to build a workers’ voice that can be loud and forceful enough to get the government to do its job and employers to do right.