Pennsylvania Lawmakers Debate Use of ‘Independent Contractor’ Label

June 5, 2008

A bill to punish builders that avoid worker’s compensation fees and other costs by wrongly classifying workers as independent contractors was amended on the Pennsylvania House floor on Tuesday.

The legislation aims to address supposed abuses in the construction industry.

“Each member here is aware, in their districts, of a fact pattern for which this law is necessary,” said the prime sponsor, Rep. Brian Lentz, D-Delaware.

He said companies have been using independent contractor status in hiring illegal immigrants.

The Construction Industry Independent Contractor Act, as it would be known, would increase penalties for companies that use independent contractor status as a way to avoid paying unemployment compensation, overtime, minimum wage and other costs.

“It’s not fair to the thousands of businesses that are doing it the right way, and it really is not fair to the workers who are being used under the auspices of an independent contractor just so they don’t have to pay their unemployment compensation,” said Rep. Dan Surra, D-Elk.

Lentz’s bill would set standards under which a worker can be properly classified as an independent contractor, including proof they are free from direction and control of the employer.

Republican opponents warned the bill would damage Pennsylvania’s business climate.

“Do you really care about family sustaining jobs, do you really care about economic activity in this state?” asked Rep. Mike Turzai, R-Allegheny.

Rep. Scott Boyd, R-Lancaster, withdrew a “gut and replace” amendment that would have completely altered Lentz’s bill to include provisions favored by business groups.

“Unfortunately we were not able to garner any support from the labor industry at all,” Boyd said.

The bill awaits a final vote in the House and faces uncertain prospects in the Republican-controlled state Senate.

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