MCAA and the UA File Joint Comments on Independent Contractor Status

October 28, 2020

In a joint letter to the Department of Labor (DoL) submitted on October 26, 2020, MCAA and the UA requested that the agency withdraw proposed regulations on independent contractor status under the Fair Labor Standards Act (RIN 1235-AA34).

The joint comments extend a decades long collaboration between the UA and the MCAA on this very important issue that dates back to 1996, when the two organizations worked together on testimony at the House and Senate fiscal committees on the then proposed Section 530 tax law changes to close the worker misclassification loophole (which has yet to be addressed). The UA and MCAA continue to work jointly to address the very intractable and serious tax and workforce standards, and fair competition abuses of tax cheating by unscrupulous employers that misclassify employees as independent contractors.

The most recent joint MCAA/UA comments to the Labor Department on the proposed loosening of the “economic reality” test to judge if workers are covered by the Fair Labor Standards Act seeks a roll back of the proposal and urges DoL to take a much broader approach to effectively address the long-standing and unabated serious abuses of worker misclassification.

In the letter, MCAA President Brian Helm and UA General President Mark McManus state that, “In fact, the DoL proposal is hasty in the extreme, too narrow, unfairly permissive, and misses an opportunity to make significant strides in stemming abuses, rather than narrowing the established DoL economic reality/suffer and permit framework for worker classification analysis, to open up a more lax administration of that standard.”

The MCAA/UA comments go beyond characterizing the problem, which has long since been well documented by myriad studies at the Federal and state levels, and questions why the DoL has chosen to take this hasty and narrow approach at this late stage of the Administration. The joint MCAA/UA comments call for a much broader and long overdue inter-agency approach by affected Federal workforce enforcement agencies to create a more effective remedial approach by all Federal labor and employment and tax enforcement agencies – including issuing industry-by-industry compliance guidance.

In the letter, MCAA President Brian Helm and UA General President Mark McManus strongly assert that, “…the MCAA/UA joint interest in finally and comprehensively staunching the longstanding and persistent scourge of worker misclassification, unfair competition, legal compliance avoidance, and tax cheating by unscrupulous employers in the construction industry – where misclassification goes beyond prevalent to rampant – …is very strong and in perfect parallel with the public interest in maintaining high workforce standards.”

Joint Comments

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