Even though it hasn’t been much in the news, the U.S. Congress re-introduced the Payroll Fraud Prevention Act of 2014. Since re-introduction in May, there have been several high profile criminal cases of misclassification by staffing firms to avoid paying workers’ comp and legislative attempts by states to regulate the use of independent contractors. If the legislation passes, staffing firms and employers that use temporary workers will face scrutiny and fines at the federal level for misclassification.
Should federal regulations be put in place, Professional Employer Organizations (PEO) are equipped to handle the changes. With the use of temporary employees expected to rise by 13% in the next five years, it behooves staffing firms to take the following the steps.
- Go back over and update policies related to the classifications of all workers’ you supply. The proper risks determine your workers’ comp exposure.
- Properly define temporary employees and independent contractors and keep the two separate, especially if you’re the employer of record.
- Make sure you’re allowed by state laws to provide independent contractors. You are jointly responsible for providing workers’ compensation in some states, regardless.
Please call us for a FREE workers’ compensation quote at 202-302-1212. Or visit us at www.StaffingCompSolutions.com.
All the best
David Schek
President-Work Comp Staffing Solutions