Illinois Attorney General Lisa Madigan has reached an agreement to settle claims against five Chicago-area construction firms that were falsely classifying their employees as independent contractors, rather than fully employed laborers. Under the settlement agreement, the businesses will end the practice. As we have learned in litigation, this practice is all too common. It has been used as a way for companies to skirt labor laws. The practice greatly harms the misclassified workers by limiting their legal protections, including access to workers’ compensation, unemployment assistance and fair wages.
The settlement follows claims investigated by Attorney General Madigan and the resulting lawsuit alleging the five small construction companies were in the practice of misclassifying dozens of their workers as independent contractors when they were actually employees of the companies. Under Illinois law, workers must be treated as employees unless they meet specific criteria permitting them to be classified as independent contractors.
All five companies have agreed to pay more than $79,000. The agreement also forbids the companies from participating in construction projects with public bodies for the next four years. Additionally, pursuant to the agreement, the Attorney General can inspect the businesses for compliance with Illinois labor laws at any time during the next five years. Finally, the agreement requires the Defendants to properly classify their workers as employees and pay all required contributions to the State of Illinois.
Source: Illinois Attorney General’s Office
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