The Dangers of Misclassifying Construction Workers as Independent Contractors in California
Kathleen Hsu and Christine C. Lee
Kathleen Hsu is an associate in the Washington, DC office of Smith, Currie & Hancock LLP. Kathleen concentrates her practice in the areas of construction law, litigation, government contracts, and appropriations. She received her Juris Doctor from American University, Washington College of Law. She served as Managing Editor of the American University Business Law Review.
Christine C. Lee is Of Counsel in the San Francisco office of Smith, Currie & Hancock LLP. She practices in the areas of employment, construction, and commercial and real estate litigation. Ms. Lee emphasizes her practice in counseling construction employers and employees on their rights and obligations under California employment law. Christine received her juris doctor degree from the University of California, Hastings College of the Law, where she was a member of the Communications & Entertainment Law Journal.
Construction companies must be aware of the difference between employees and independent contractors. State and federal agencies are increasingly targeting the misclassification of workers in the construction industry. The repercussions for misclassifying employees as independent contractors, intentionally or not, include government audits, lawsuits by the government or by the misclassified worker, and payments of back wages, past taxes, civil penalties, and damages.