July 03, 2023

New bi-state task force to stop worker misclassification is a game-changer

By Mark Lynch, Jr., Business Manager, IBEW Local 98

Purchased - Construction workers on a work site

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On behalf of the members of IBEW Local 98, as well as all union members in Pennsylvania and New Jersey, I want to publicly thank PA Governor Josh Shapiro and NJ Governor Phil Murphy for recently forming a new interstate task force to better protect workers and crack down on unscrupulous construction contractors that routinely engage in the misclassification of workers and outright work theft. The experienced members of the task force were chosen by PA Secretary of Labor & Industry Nancy Walker and NJ Department of Labor & Workforce Development Commissioner Robert Asaho-Angelo.

Mark Lynch, Jr., Business Manager, IBEW Local 98

Every local union in both state’s Building Trades Councils confronts this problem on a daily basis, including IBEW Local 98. And it’s a significant problem indeed - the PA Department of Licenses & Inspections estimates that 389,000 workers in Pennsylvania are misclassified annually. Now, with the arrival of the task force, the states will share data and case information that will help with the enforcement of labor law violations and also help develop new strategies to prevent wage theft and worker misclassification. The scam works like this: non-union contractors falsely and illegally misclassify workers as “independent contractors” instead of employees in order to evade payroll taxes and benefits contributions. Governor Shapiro knows about the scam all too well. As PA Attorney General, he successfully brought charges against Glenn O. Hawbaker, a major non-union contractor in the state. The firm was ordered to repay a whopping $20 million to more than 1,000 workers that were victims of Hawbakers’ wage theft.

Workers aren’t the only ones who get shortchanged. Uncollected payroll taxes hurt both states’ local municipalities and place a financial strain on the constituent services they provide - police, fire, schools, water, sanitation and more. The affected municipalities have to raise law-abiding citizens’ taxes to cover the financial shortfalls created by the cheating contractors. Local 98 and the Philadelphia Building Trades are also grateful for the crackdowns already initiated by D.A. Jack Stollsteimer in Delaware County and D.A. Matt Weintraub in Bucks. Their efforts are working. Of course, the easiest way to avoid the misclassification of workers scam is to hire - or work for - a union contractor. They play fairly and by the rules.

Mark Lynch, Jr., Business Manager, IBEW Local 98