Wisconsin Gov. Tony Evers this week signed an executive order launching a joint enforcement task force on payroll fraud and worker misclassification. The task force will coordinate worker misclassification matters handled by the Departments of Revenue, Workforce Development, and Justice, as well as the Office of the Commissioner of Insurance and other agencies; it will report to the governor on or before March of each year on their activities.
“Last year alone, UI Division auditors conducted 2,459 audits, identifying 8,677 misclassified workers and recouping more than $1.5 million in UI taxes, interest and penalties due to their efforts,” said UI Division Administrator Mark Riehl. “By better coordinating our state level efforts to level the playing field for Wisconsin contractors and workers, we are building a better tomorrow for thousands of Wisconsin workers and business owners, while helping to ensure the integrity of Wisconsin’s UI Trust Fund.”
The task force will be staffed by the Department of Workforce Development and will consist of the secretaries of DWD, the Department of Revenue, the administrators of the Worker’s Compensation and Unemployment Insurance divisions within DWD, the Attorney General or a designee, the commissioner of insurance or designee and others. The DWD secretary will serve as chair.
DWD also operates a team of worker misclassification investigators, many of whom have law enforcement backgrounds in white collar and economic crime investigations. In 2018, that team conducted more than 500 worksite investigations and helped educate the public about the severity of worker misclassification by presenting at construction industry events, labor union meetings and other public forums.
“Worker misclassification is an issue of fairness and equity,” DWD Secretary-designee Caleb Frostman said. “For too long, certain contractors have forced individuals into independent contractor status to avoid unemployment insurance taxes and workers’ compensation premiums, depriving workers of the security that the employer-employee relationship provides. They have also created an unfair business climate that places businesses that follow the law at a competitive disadvantage.”