Worker Misclassification Drains Money from Vital Public Services

When it comes to drains on our state budget, special interest tax breaks aren’t the only thing taking money away from vital public services. Another issue is worker misclassification, which occurs when an employer incorrectly designates a worker as an independent contractor rather than an employee. This misclassification is not only unfair to the employee — who doesn’t receive protections like unemployment, workers compensation and other benefits of employment rather than contracting — but also to the state budget, which sees less in income taxes and other taxes. In the construction industry alone, more than $11 million in revenues to the state were lost, according to a 2011 study.