AB 474

Outreach and education regarding employee misclassification

The bill directs the commissioner of insurance to conduct, on at least an annual

basis, outreach and education to insurers and other persons regulated by the state

insurance laws on how to identify the misclassification of employees and report

suspected misclassifications to the appropriate federal and state agencies.

Worker classification notice and posting

The bill requires the Department of Workforce Development to design and

make available to employers a notice regarding worker classification laws,

requirements for employers and employees, and penalties for noncompliance. Under

the bill, all employers in this state must post the notice in a conspicuous place where

notices to employees are customarily posted. The bill also provides a penalty of not

more than $100 for an employer that does not post the notice as required.

Website for worker classification laws

Under the bill, DWD must establish and maintain on the department's website

information regarding worker classification laws, requirements for employers and

employees, penalties for noncompliance, and contact information at each state

agency that administers worker classification laws.

Unemployment insurance; worker misclassification penalties

Current law requires DWD to assess an administrative penalty against an

employer engaged in construction projects or in the painting or drywall finishing of

buildings or other structures who knowingly and intentionally provides false

information to DWD for the purpose of misclassifying or attempting to misclassify

an individual who is an employee of the employer as a nonemployee under the UI law.

The penalty under current law is $500 for each employee who is misclassified, not

to exceed $7,500 per incident. Current law additionally requires DWD to assess an

administrative penalty against such an employer who, through coercion, requires an

individual to adopt the status of a nonemployee in the amount of $1,000 for each

individual so coerced, but not to exceed $10,000 per calendar year. Penalties are

deposited in the unemployment program integrity fund.

The bill removes the $7,500 and $10,000 limitations on these penalties and

provides that the penalties double for each act occurring after the date of the first

determination of a violation. The bill also removes the limitations on the types of

employers that the penalties apply to, allowing them to be assessed against any type

of employer that violates the above prohibitions.

Worker's compensation; penalties for uninsured employers

Under current law, DWD is required to assess an administrative penalty

against an employer who requires an employee to pay for any part of worker's

compensation insurance or who fails to provide mandatory worker's compensation

insurance coverage. If the employer violates those requirements, for the first 10

days, the penalty under current law is not less than $100 and not more than $1,000