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Independent Contractor: How Employers Evade Workers Compensation & Overtime Laws


Posted on Oct 08, 2011

"Independent contractor" -- misclassifying employees as an "independent contractor" is a widely used ruse to evade paying overtime and workers compensation benefits required by law as reported by Andrew Leonard in this article: Employers' New Ruse: "Independent Contractor." 

Employers are required to pay employees a minimum wage and overtime for hours worked more than 40 in a week, but these requirements do not apply to an "independent contractor."  

Likewise, employers are required to have Kentucky workers compensation insurance coverage for their employees, but they have no such obligation as to an "independent contractor."  

A Department of Labor study in 2000 found that about 30% of employers misclassified employees as independent contractors.   

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