WASHINGTON (July 20, 2015) — The U.S. Department of Labor and the Kentucky Labor Cabinet have signed a memorandum of understanding (MOU) to protect the rights of Kentucky workers by preventing their misclassification as independent contractors instead of employees.
Misclassification of employees as independent contractors is an increasing problem, the Labor Department's Wage and Hour Division said in a report issued July 15.
“When employers improperly classify employees as independent contractors, the employees may not receive important workplace protections such as the minimum wage, overtime compensation, unemployment insurance and workers' compensation,” the report said.
Kentucky is the 23rd state to sign an MOU with the Labor Department on this issue. The others are Alabama, California, Colorado, Connecticut, Florida, Hawaii, Illinois, Iowa, Louisiana, Maryland, Massachusetts, Minnesota, Missouri, Montana, New Hampshire, New York, Rhode Island, Texas, Utah, Washington, Wisconsin and Wyoming.
The Tire Industry Association told Tire Business this is not an issue the trade group is following.