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Protecting Workers Rights by Stopping Misclassification as Independent Contractors in Maryland

Protecting Workers Rights by Stopping Misclassification as Independent Contractors in Maryland

Thursday, April 23, 2009

PERMALINK: http://www.progressivestates.org/node/23013

CONFERENCE CALL TODAY: COVERING ALL KIDS: CHIPRA, ICHIA, and Economic RECOVERY

Covering All Kids: CHIPRA, ICHIA and Economic Recovery

WHAT: A national conference call to discuss the recent reauthorization of CHIP and its economic benefits, including a new option for states to receive higher federal matching rates to cover legal immigrant children and pregnant women. 

WHEN:
TODAY, Thursday, April 23, 2009 at 3:00pm EST.

SPEAKERS WILL INCLUDE:

Sen. Luz Robles, Utah State Senate
Judi Hilman, Utah Health Policy Project, Executive Director
Sonal Ambegaokar, National Immigration Law Center, Health Policy Attorney
Jennifer Sullivan, Families USA, Senior Health Policy Attorney
Caroline Fan, Progressive States Network, Immigration and Workers' Rights Policy Specialist
Nathan Newman, Progressive States Network, Interim Executive Director

Please RSVP online to receive dial-in information for the call and post-call updates and resources.

Valuing-Families

By: CAROLINE FAN

Protecting Workers Rights by Stopping Misclassification as Independent Contractors in Maryland

Earlier this month, the Maryland legislature joined a number of states in cracking down on worker misclassification by enacting the Maryland Workplace Fraud Act (S 909 / H 819 ) which has the support of Gov. O'Malley who is expected to sign the bill shortly.  The main focus of the bill was stopping the misclassification of workers as "independent contractors" used by employers to deny them a minimum wage, overtime and key workplace benefits:

  • Helping Workers Enforce their Own Rights:  A key provision in the bill is a private right of action where workers knowingly misclassified as independent contractors by their employer can enforce their own rights in court and receive treble damages and attorneys fees among other relief.  The law gives workers three years after a violation to file a case in court, although employees cannot sue on their own where an government agency has taken action and issued a final order against a company.  The prospect of triple damages and other financial relief makes it far more likely that minimum wage workers will be able to find lawyers willing to take their case and hold their employers accountable.  Since few states have such an explicit private right of action for independent contractors misclassified as independent contractors, the law is path-breaking in this area.
  • Expanded Powers for State Enforcement:  The Workplace Fraud Act grants the state Department of Labor, Licensing and Contracts the right to enforce worker misclassification in the construction and landscaping industries, and allows agencies the authority to give offending companies citations and fines. The law also steps up agency enforcement by enabling the Labor Commissioner to hold hearings and assess penalties for worker misclassification, and coordinate with other agencies that each independently assure employer compliance on workers' compensation, unemployment benefits, and other state regulations.  The law increases civil fines to $5000 for knowingly misclassifying a worker the first time, assessing double that amount the second time, and assesses a $20,000 fine for the third offense.  All civil fines would go into the General Fund.  The law also increases damages for workers and encourages quick resolution of complaints with a judgment required within 120 days of the Commissioner receiving a complaint.
  • Increased Agency Funding and Accountability: The law includes specific annual funding of $700,000 for upholding labor standards and the prevailing wage by the DoL. It also provides for an annual report on wage administration and enforcement by the state agency.
  • Increased Employer Transparency and Record Keeping:  To encourage record keeping by employers (who often seek to evade the law by not keeping records), the law authorizes fines of $500 per day if employers fail to provide documentation on independent contractors after a request by the Commissioner of Labor and Industry.  For at least 3 years employers must keep records of each worker's classification, their pay rate, hours worked, and the amount they were paid each pay period. If workers are classified as independent contractors or exempt individuals, the employer must provide them with written notice in English and Spanish of their classification and what the implications are for being a contractor versus being an employee.

Other States Taking Action on Misclassification:  State legislators introduced a large number of bills across the states addressing the problem of misclassification of workers this session, many of which include a private right of action for workers.  These include: CO H 1310, IN S385, IN SR 74, KS H 2175, KS H 2281/KS S 229, KY S 136/KY H 392 , MA H17, MA H17, MA H1870/MA S 682, 2009 MA S 718NYA 403, NYA 403, OR H2890, PA H 400, RI H 5049, RI H 5178, RI SR 279 , RI H5676/RI S 643 , TX H2271 ,VT S 137 , VT S 137  Last year, the Governors of New Jersey (NJ EO 96), Massachusetts (MA EO 499), Michigan (EO 1) and Iowa (EO 8) signed Executive Orders creating task forces and commissions to address the problem of rampant worker misclassification.

The importance of cracking down on misclassification was emphasized by a Cornell University study found that about 10.3% of the private workforce in New York were wrongly classified as contractors and that this cost the state unemployment insurance payments of $175,674,161 from 2002-2005. So enforcing proper classification of employees can be a revenue generator for governments while ensuring a level playing field for workers and employers.

Wage Enforcement a National Trend:  On top of the misclassification issue, states have been debating and passing a number of other kinds of wage enforcement bills this session. In Maryland, both  chambers also approved SB 406 which would expand rights and remedies for private enforcement suits under the state prevailing wage law, but the House and Senate were unable to concur before the session ended.  Maryland also introduced SB 451 which would increase criminal penalties for violations of certain wage and hour laws and would allow each week to constitute a separate violation. 

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Increasing-Democracy

By: NATHAN NEWMAN

Their Secessionist "States Rights" versus Our Collaborative Federalism

There have recently been a wave of rightwing resolutions asserting "state sovereignty," with Governor Rick Perry even evoking Civil War-era rhetoric about Texas having the right to secede from the United States. 

The Rightwing Continues Pre-Civil War Confederate View of Federalism: Most of the resolutions are relatively empty rhetoric repeating the Tenth Amendment's phrasing of powers "reserved to the states respectively, or to the people," sometimes with a few cranky references to illegitimate Federal Reserve power or complaining about infringement on the right to bear arms.  The Georgia Senate went one step further into Southern Confederate rhetoric and approved a resolution that asserts the right of the state to "nullify" federal laws it disagrees with and even declares many federal criminal statutes void.

What the resolutions share, unsurprisingly, is a focus on a Tenth Amendment that originally justified slavery and Confederate secession, while the resolutions studiously ignore the existence of a 14th Amendment (along with other post-Civil War amendments) that explicitly gave the Congress new powers to supersede state laws and put to rest these kinds of secessionist and nullification-style interpretations of the original Constitution.  As this Brennan Center for Justice report from a few years ago outlines, any focus on Constitutional "original intent" must focus on the intent of the authors of those post-Civil War Amendments and recognize the broad federal powers intended to rectify the harms created by slavery and other social ills that festered in the pre-Civil War constitutional era.  

The Alternative Progressive Demand for Collaborative Federalism:  That said, there is a long progressive tradition of demanding that the federal government respect state authority that does not conflict with federal laws.  As we wrote in Restoring State Authority: An Agenda to Restrict Preemption of State Laws, the real problem is that too often, even when Congress has not explicitly legislated against state powers, the executive branch and the courts have used loose interpretations of those statutes to void state laws meant to protect consumers, workers and the environment. 

The irony is that so many of the rightwing activists who have suddenly discovered the abuses of federal power were silent over the last eight years as the Bush administration and the conservative courts voided state laws designed to stop the sub-prime mortgage mess, protect labor rights, or generally restrain corporate abuses

Instead of talking about secession and playing a game of which level of government has responsibility for protecting the public's health, safety and economic well-being, the progressive view of federalism is that we should maximize collaboration, innovation in policy and protection of individual rights by all levels of government.  The federal courts and Presidency should defer to state authority, unless there has been an explicit decision by the Congress to preempt that local authority -- which itself should be rare.  Federal laws and regulations should be a floor for consumer, civil rights and worker protections, with the ability of states to create or enforce more expansive protections for individuals strongly protected.

Neo-confederate rhetoric around "states rights" and secession should be condemned, but progressives should be asserting a robust vision of collaborative federalism and a federal government that respects state innovation -- a vision that the Obama administration seems to be embracing to its credit.

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Increasing-Democracy

By: CHRISTIAN SMITH-SOCARIS

Florida Rightwing Attempts to Suppress Voting Rights with Election Restrictions

Just weeks before the end of the legislative session, rightwing lawmakers in Florida are advancing omnibus legislation that progressive voting rights advocates and legislators see as yet another scheme to reduce voter turnout and manipulate election rules to the benefit of conservatives.  The omnibus legislation was sprung on unsuspecting legislators and advocates the day before it was voted on in a Senate committee, where only a few minutes of debate were allowed before a party-line vote. 

Touted as a collection of "anti-fraud" measures, SB 956/HB 7149 the bill is actually designed to put barriers in the way of registering and voting on election day, including:

  • Removing identification from retirement centers and neighborhood associations identification from the list of acceptable voter ID which would have a devastating impact on elderly and disabled voters.
  • First-time voters would not be able prove their identity at the polls on election day, but would have to provide it before election day, a requirement that no other state has.
  • Requiring voter registration forms collected by third parties to be submitted within 48 hours of when they are filled out.  This provision and the associated penalties would effectively shut down independent voter registration drives in Florida, something the state has tried to do before.
  • Force voters who move within a month of election day to vote by provisional ballot.

The bill would also substantially reduce the accountability of politicians and prevent the full and accurate counting of ballots as a matter of policy:

  • County party chairmen will have the exclusive right to designate poll watchers.
  • People "offering legal advice regarding voting or ballots" are specifically prevented from communicating with voters inside or outside a polling place or in line to vote.
  • Political committees registered in other states are exempted from complying with campaign finance laws.
  • Slush funds for political leaders to make unregulated donations to other politicians are specifically allowed by the bill, reversing an earlier prohibition.
  • Puts a strict, one-week limit on the duration of any post-election audits of ballots; and mandates that elections will be certified a week and a half after a primary and two weeks after a general election, regardless of whether all votes have been counted or recounted.
  • Makes the unelected Secretary of State solely responsible for ordering a recount in all but local elections.

Bill Condemned Throughout State: This toxic stew of provisions have raised considerable ire in the state and nationally, with editorial boards, labor leaders, voting rights activists, and lawmakers railing against this naked power grab in the guise of election reform.  Commenting on the less than six minutes of debate and 60 seconds of public input that led to a vote in committee, Rich Templin, executive director of the Florida AFL-CIO, said "[t]hey are certainly violating any premise of good government, any premise of open government, any premise of transparency, or the cornerstones of representative democracy."  Regarding the substance of the measure Templin opined that "[t]his bill should really be called the Florida Democracy Reduction Act. It is designed to reduce people’s participation, to reduce people voting, and to reduce people’s access to the process."  Republican Governor Charlie Crist is unhappy with the legislation's disenfranchising elements.  While not issuing a veto threat, he had the following to say:

"The more opportunity you give people to vote, the better it is for democracy. So that aspect of it concerns me...It always seems to me that when there may be legislation that attempts to sort of make it harder for people to do something — the people that we work for —  generally that’s not good. I don’t look on that in a favorable light and that is true of this particular part of this legislation."

Attempts to twist voting rules to suppress voter turnout are not surprising given the thumping that conservatives have taken at the polls in recent years.  And while Florida is once again leading the pack in shady voting changes, it is in keeping with similar tactics of suppressing voter drives, loosening campaign regulations, and using ID requirements to thwart elderly voters, that have surfaced in other states.

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Increasing-Democracy

By: CHRISTIAN SMITH-SOCARIS

Washington State Legislature and Nevada Assembly Pass National Popular Vote

Following votes in the Washington House and Senate, National Popular Vote now goes to the Governor Chris Gregoire, who has expressed support and whose signature will make Washington the fifth state to enact NPV -- reaching 23% of the the electoral votes needed to go into effect.   

The Nevada Assembly on April 21st became the 27th state legislative chamber overall to approve NPV.

 

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Research Roundup

New analysis on income inequality and taxing the wealthy:

  • Raising State Income Taxes on High-Income Taxpayers  - This report from the Center for Budget and Policy Priorities highlights how $8 billion in revenue could be raised if every state with a personal income tax enacted a 1 percent rate increase on households making more than $500,000 a year.   The report also emphasizes that raising taxes, especially on the wealthiest households, is less harmful for the economy than cutting many types of services. 

New transit and clean energy reports:

  • Transportation investments and the labor market: How many jobs could be generated and what type? - This Economic Policy Institute brief calculates that a $100 billion investment in transportation infrastructure will generate $160 billion in output, over 1 million jobs, and reduce wage inequality by raising earnings for workers without college degrees and expanding the number of unionized jobs.
  • Fact Sheet: How a "Climate Rebate" Would Work - To offset the costs to families of restrictions on greenhouse-gas emissions, this Center for Budget and Policies Priorities fact sheet outlines a few options for delivering a tax rebate to almost all low-and moderate-income families without new bureaucratic structures and low administrative costs.

Life for immigrants in America:

  • Under Siege: Life for Low-Income Latinos in the South - This report by the Southern Poverty Law Center finds that low-income Latinos in the South are routinely the targets of wage theft, racial profiling and other abuses driven by an anti-immigrant climate that harms all Latinos regardless of their immigration status. SPLC found that of 41% of respondents save they have experienced wage theft, with the number rising to an astonishing 80% in New Orleans.
  • A Portrait of Unauthorized Immigrants in the United States - According to this Pew Hispanic Research Center survey, undocumented immigrants are more geographically dispersed than in the past, more likely than U.S. born residents to live with a spouse and children, and 73% of the children of undocumented parents were born in the U.S. and are U.S. citizens- just some of the findings from the new report.
  • Community Treasures: Contributions of Older Immigrants and Refugees - Project SHINE and the Center for Intergenerational Learning highlight the civic involvement and family care giving and leadership roles among immigrant elders in the Latino, Chinese, Liberian, Vietnamese, Somali, and Ethiopian communities.

New health care reports:

  • Insuring All Americans Is a Critical Component of an Efficient, High Quality Health Care System - This report by the Center for Budget and Policy Priorities explains how universal health coverage would decrease the likelihood that individuals delay seeking care, make early detection and treatment of problems more feasible, reduce reliance on costly emergency room care, and also reduce underwriting if the system is designed well.
  • Covering Health Issues - This source book by the Alliance for Health Reform is aimed at journalists and contains chapters with fast facts and background information for policy debates around health reform, health care costs, health care quality, employer-sponsored coverage, individual coverage, children's coverage, Medicare, Medicaid, long-term care, disparities, public health and mental health.
  • Key Health and Health Care Indicators by Race/Ethnicity and State - This updated fact sheet by the Kaiser Family Foundation shows variations across all 50 states and racial and ethnic groups for six key health and health care indicators such as mortality rates and number of uninsured.

Effects of race and changing gender on poverty and unemployment:

  • Among college-educated, African Americans hardest hit by unemployment - While college-educated white workers still had a relatively low unemployment rate of 3.8% in March of this year, this snapshot by the Economic Policy Institute shows the rate for college-educated blacks was 7.2%—almost twice as high as the white rat and up 4.5% since March 2007 - emphasizing that education alone doesn't overcome racial disparities in who suffers during times of economic downturn.
  • Changing Poverty and Changing Antipoverty Policies - In this survey of the changing factors effecting poverty since the 1970s, the Institute for Research on Poverty finds that racial disparities in poverty, changing gender roles and labor force participation by women means that policies need to focus on making work pay, helping parents balance work and family responsibilities, and raising the educational attainment of disadvantaged children.

Please email us leads on good research at research@progressivestates.org

Resources

Protecting Workers Rights by Stopping Misclassification as Independent Contractors in MD

Maryland SB 909 - The Workplace Fraud Act
Progressive States Network -Promoting Wage Enforcement Laws as an Alternative to Anti-Immigrant Proposals
Progressive States Network -New Mexico Enacts Wage Enforcement, Joins National Trend
Cornell University Institute for Labor Relations -The Cost of Worker Misclassification in New York State
California -2006 Fraud Deterrence and Detection Activities report
National Employment Law Project - Summary of Independent Contractor Reforms 2008 

Their Secessionist "States Rights" versus Our Collaborative Federalism

Progressive States Network - Restoring State Authority: An Agenda to Restrict Preemption of State Laws
Brennan Center for Justice - A New Birth of Freedom: The Forgotten History of the 13th, 14th and 15th Amendments
Center for Progressive Reform - Federal Preemption: Undercutting State Protections for Health, Safety and the Environment
Constitutional Accountability Center - Redefining Federalism

Florida Rightwing Attempts to Suppress Voting Rights with Election Restrictions

Florida Senate Bill 956
St. Petersburg Times - With Little Discussion, Florida House Council Passes Sweeping Changes to Voting Rules
St. Petersburg Times - GOP Power Grab is an Affront to Voters
New York Times - Suppressing the Vote in Florida
AFL-CIO - Legislators Restricting Voter Access in Florida 

Masthead

The Stateside Dispatch is written and edited by:

Nathan Newman, Interim Executive Director
Caroline Fan, Immigration and Workers' Rights Policy Specialist
Julie Schwartz, Broadband and Economic Development Policy Specialist
Christian Smith-Socaris, Election Reform Policy Specialist
Adam Thompson, Health Care Policy Specialist
Julie Bero, Executive Administrator and Outreach Associate
Austin Guest, Communications Specialist
Marisol Thomer, Outreach Coordinator

Please shoot us an email at dispatch@progressivestates.org if you have feedback, tips, suggestions, criticisms, or nominations for any of our sidebar features.

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