Archive for the ‘Independent Contractors’ Category

Independent Contractor Status: Six Tips for Strengthening the Independent Contractor Relationship

Thursday, February 18th, 2010

By:  Nancy E. Joerg, Esq., Senior Attorney and Shareholder, Wessels Sherman Joerg Liszka Laverty Seneczko P.C.

1.    If you have anyone who works directly with the independent contractors, don’t call that individual a “Manager” or a “Director” as those are words of supervision which indicate control and direction. You should instead use a word like “Coordinator.” Check your website, applications, and all printed material to make sure you are not inadvertently referring to your independent contractors as employees in any way!

2.    Try to only use independent contractors who are incorporated in good standing so. Incorporation will not make your company bullet proof, but it is certainly a very strong fact for independent contractor status.

Check the Secretary of State’s website on a yearly basis to verify that each corporation is in “good standing.” In Illinois, the website is www.cyberdriveillinois.com. Pick a date that you will remember (like your birthday), and then each year on that date, check each independent contractor’s corporation to verify it is in good standing. Print out the proof of good standing and put it in the independent contractor’s file.
(more…)

Tags:
Posted in Independent Contractors | 3 Comments »

Illinois Construction Update: IDOL Crushes Contractor for Reportedly Misclassifying Subcontractors as Independent Contractors

Tuesday, December 22nd, 2009

By:  Jeffrey A. Risch, SmithAmundsen LLC

In what is believed to be the largest assessment issued by the Illinois Department of Labor (IDOL) under Illinois’ new Employee Classification Act (Act), a Chicago-area contractor has been penalized over $325,000.00 for treating its workers as independent contractors rather than employees.  IDOL recently issued its final determination and assessment under the Act against Elmwood Park, Ill. based Mega Builders Inc. The determination faulted Mega Builders for failing to classify 18 workers as employees and for also “scheming” to evade its obligations under the Act by forcing workers to incorporate.
(more…)

Tags: , , ,
Posted in Independent Contractors | 1 Comment »

WHOA, NELLIE! – Federal Government Announces Crackdown On Employers Misclassifying Independent Contractors!

Wednesday, December 9th, 2009

By:  Jeffrey A. Risch, SmithAmundsen LLC

 

When I first received word that the United States Department of Labor and the Internal Revenue Service were both taking monumental efforts to “go after” employers for misclassifying workers as independent contractors, the first thing that entered my head was the famous words of College Football’s most acclaimed broadcaster, Keith Jackson.  Jackson’s famous “WHOA… NELLIE!!!” was often used to describe the truly rare and incredible play (for better or worse) that would occur once in any college football game.  It was the perfect expression that echoed through my head when I read the press clippings on the latest government crackdown (and while personally immersed in the final weeks of the College Football season).


On November 9, 2009, the Internal Revenue Service announced that it will begin conducting random audits of 6,000 companies starting in February 2010 — with the goal of reducing the number of misclassified independent contractors while expanding revenues. The IRS will randomly select 2,000 taxpayers each year for the next three years. The examinations will be comprehensive in scope.  Employers will receive notices describing the process.  Records pertaining to employment tax returns and issues will be subject to immediate review.  Employers are being forewarned by the IRS to have all of their records available to expedite the examinations.  These audits will include line-by-line reviews of employment tax returns and related documents. These audits will initially focus on four targeted areas: payroll taxes, independent contractor status, fringe benefits; and executive compensation. 

  (more…)

Tags: , ,
Posted in Independent Contractors | No Comments »

IDES AUDITS: HOW EMPLOYERS SHOULD FILL OUT THE AUDIT QUESTIONNAIRE

Monday, December 7th, 2009

By:  Nancy E. Joerg, Esq., Senior Attorney and Shareholder, Wessels Sherman Joerg Liszka Laverty Seneczko P.C.

When an Illinois Department of Employment Security (IDES) auditor audits a company that uses independent contractors, the IDES auditor almost always gives the company a questionnaire to fill out. The IDES has been using the same basic multi-page questionnaire called the Worker Relationship Questionnaire for several decades.

The purpose of the Worker Relationship Questionnaire is to obtain detailed information from the company about the alleged independent contractor relationship. The Questionnaire is designed so that it can be filled out by the company or by the auditor. (This is at the auditor’s discretion.) At the end of the Questionnaire, there is a space for the individual who filled out the questionnaire to sign that they indeed filled out the questionnaire and provided the responses.

(more…)

Tags: ,
Posted in Independent Contractors, Labor Law | 1 Comment »