Enforcing Labor Laws Must Be Priority (fail to pay employee taxes and workers’ compensation ins)

http://www.hartfordbusiness.com/news9923.html

08/17/09

State authorities need to direct more resources toward the effort to crack down on subcontractors who fail to pay employee taxes and workers’ compensation insurance.

As the Hartford Business Journal’s Diane Weaver Dunne reports today, a team of state labor department employees issued 220 stop work orders during the past 22 months, a rate that far exceeds neighboring states such as New York and Massachusetts.

But despite the highly laudable work of those investigators, Connecticut’s big-picture efforts lag significantly behind in the collection of back taxes and fines, primarily because the state does not have the kind of comprehensive enforcement program that those other states employ.

The problem of employees being misclassified as independent contractors — and the subsequent failure to pay proper taxes — affects many Connecticut businesses that play by the rules but find themselves losing out on jobs that other companies can do for less money.

A number of general contractors who find themselves high on the state’s list of companies with the most stop-work orders also complain that a less-than-comprehensive enforcement program leaves the incorrect impression that they don’t make any effort to weed out subcontractors who break the law.

Connecticut seemed to recognize the importance of stepping up its regulatory efforts when the legislature passed a law in 2007 that provided the labor department with power to issue stop work orders.

FULL story at link.