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House of Representatives
Session of 2013 - 2014 Regular Session


Posted: January 16, 2013 10:09 AM
From: Representative John P. Sabatina, Jr.
To: All House members
Subject: Reintroduction of former HB2540 of the 2011-2012 Session. Prohibiting Employee Misclassification in the Commercial Carrier Industry


To: All House Members

From: Representative John P. Sabatina, Jr.

Date: January 16, 2013

Subject: Reintroduction of former HB2540 (2011-12 session) Prohibiting Employee Misclassification in the Commercial Carrier Industry.
In the near future, I will be re-introducing legislation to reduce the practice of intentionally misclassifying employees as independent contractors in the commercial carrier industry.

Intentional misclassification of workers occurs when employers designate workers as independent contractors, or hire them "off the books." This practice creates missed revenue for the state, and denies a worker important employment rights and benefits. Employers avoid paying income taxes, minimum or overtime wages, workers' compensation premiums and contributions to the unemployment compensation system.

Employers also dodge coverage by the federal Americans with Disabilities Act, the Occupational Safety and Health Act, and the Fair Labor Standards Act. By ignoring all of these laws, these dishonest employers are undercutting honest and hardworking firms that pay their taxes and own up to their responsibilities.

In 2008, the Pennsylvania Compensation Rating Bureau (PCRB) estimated that 9% of all employees in the state are misclassified, costing the Unemployment Compensation Trust Fund $200 million annually. A 2009 report commissioned by the Government Accountability Office (GAO) found that misclassification cost federal revenues $2.72 billion in year 2006.

My legislation would specifically apply criteria to the commercial carrier industry by establishing whether a worker can be considered an independent contractor; allow enforcement of this act by the Department of Labor & Industry; create penalties for violations, and protect workers with complaints or grievances from retaliation by employers.

In recent years 40 states have made investigatory or legislative efforts to protect these misclassified workers.

Previous sponsors of this legislation in the last session were Reps. Barbin, Bradford, Briggs, Brownlee, Burns, Caltagirone, Carroll, Cohen, D. Costa, P. Costa, Cruz, Deasy, DeLuca, Dermody, Donatucci, Fabrizio, Farry, Frankel, Galloway, Gergely, Gibbons, Goodman, Haluska, Hanna, Harkins, W. Keller, Kortz, Kotik, Mahoney, Matzie, McGeehan, Mundy, Murt, Neuman, M. O’Brien, Pashinski, Ravenstahl, Readshaw, Santarsiero, Santoni, Sturla, Taylor, Waters, Wheatley, White, Youngblood and Neilson

I hope you will join me in sponsoring this important legislation. If you would like to be added, please contact my Legislative Assistant Bryden McCurdy at (717) 772-4032 or bmccurdy@pahouse.net.