A Raleigh, N.C., contractor must pay more than $20,000 in back wages to four employees who were found misclassified as independent contractors, the U.S. Department of Labor’s Wage and Hour Division reported. The employees worked on contracts with McDonald’s Corp. to remodel of the chain’s restaurants on the East Coast.
The company, Freeman & Associates Contracting Corp., denied overtime to the workers and violated record-keeping provisions of the Fair Labor Standards Act, according to the Department of Labor.
“Far too often employers misclassify their employees independent contractors to avoid paying them in compliance with the Fair Labor Standards Act, as well as other federal, state and local statutes,” says Richard Blaylock, director of the Wage and Hour Division’s Raleigh District Office. “Misclassification costs taxpayers huge sums of money each year in uncollected employment taxes and give unscrupulous employers an unfair advantage.”