Bill Attempts to Stop Those Who Intentionally Misclassify Workers

Oklahoma City (March 20, 2012) The Oklahoma House of Representatives passed a bill last week that would make it more difficult for employers to misclassify workers as independent contractors for the purpose of avoiding social security, unemployment or workers’ compensation premium costs.

HB 2258, by Rep. Ben Sherrer, D-Chouteau, would require that the Oklahoma Tax Commission, the Oklahoma Workers’ Compensation Court, the Oklahoma Department of Labor and the Oklahoma Employment Security Commission share information through a secure database with the intent of detecting employers who intentionally misclassify workers.

“The purpose of this legislation is simply to help ensure a level playing field in the marketplace,” said Rep. Sherrer. “I believe it is in the best interest of working Oklahomans and employers, both large and small, to ensure compliance within all areas of the law.”

According to Rep. Sherrer, the Central South Carpenters Regional Council asked him to introduce the bill. Gary Warren, who serves as the political director for the council, said the issue is wide spread especially in the construction industry.

Misclassification means that employers who cut corners at the expense of their workers are able to underbid employers who follow the law, said Warren.

“Legitimate contractors can be underbid on labor costs by up to 30 percent on projects simply because they’re following the law and their competitor is not,” said Warren.

“The bill is needed to ensure a truly competitive labor and employment marketplace and to ensure the state agencies with oversight and enforcement power have lawful authority to share sensitive employee/employer information in their custody,” said Rep. Sherrer.

The bill passed the House, 94-0, and now advances on to the Senate for further consideration.

The bill does not state what data or on whom specifically will be gathered and shared. It does say that "representatives responsible for enforcement and shall be further authorized to enter into contracts and interagency agreements and promulgate such rules as may be necessary to implement this section." The bill does not state with whom the contracts may be made or if they can or will be private firms for the data storage and analysis.