A cleaning company that had a contract with the Massachusetts Whole Foods Market has been fined $335,000 for wage and payroll violations, according to an article on the MassLive website. The state Attorney General’s Office said it misclassified workers as independent contractors.
The Attorney General issued four citations against United Services Group Inc. saying the company misclassified workers as independent contractors and failed to maintain an earned sick leave policy, furnish a suitable pay stub and maintain accurate records.
Whole Foods has terminated its contract with the company.
Employers who misclassify their employees are cheating their workers and gaining an unfair advantage over businesses that play by the rules, according to Attorney General Maura Healey.
The Attorney General's office said United Services Group failed to complete payroll or timekeeping records and paid many of its employees as independent contractors through a shell company operated by United Services' owner.
United Services Group has agreed to pay restitution and penalties, the Attorney General’s Office said.
What exactly does the law require in order to prove that a worker is a genuine “independent contractor” instead of an “employee?” According to an article on CleanLink, as a general rule, “independent contractors” are private businesses that bid for work and are evaluated on the results of their work rather than upon day-to-day performance. Although different courts employ different tests, the following factors are always important:
• How much control does the employer have over the worker on a day-to-day basis?
• Can the worker perform the work at times and days of his own choosing?
• Must the worker make a substantial investment in order to set up his business?
• Does the worker employ and pay his own assistants?
• Can the worker realize a profit or loss?
• Is the price to be paid for the work negotiable?
• Can the worker offer his services to others?
• Does the employer provide any benefits other than the agreed-upon price of the work?
• Is the relationship permanent or on a job-to-job basis?
• Does the employer use employees to do the same type of work to be performed by the “independent contractor?”
• Is the work to be performed essential (or “integral”) to the employer’s business?
• Does the work involve a special skill?
• Does the worker have to display initiative, judgment or foresight in order to succeed?
• Is there formal documentation such as contracts and invoices?