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Feds hit NH companies on 1099s for $500k Posted by on

The U.S. Department of Labor delivered an early stocking full of coal to the Poulins and their trio of cheating companies yesterday, ordering them to pay 99 workers close to $500,000 in back wages and damages as well as a civil penalty of $108,900.

Di-pat Construction, Jerry Construction and Kel-Rick Construction management, owned by Johanne, Jerry and Patrick Poulin respectively were cited for ??willful and repeated violations of the [Fair Labor Standards Act] minimum wage, overtime and record keeping provisions.?? All three companies are based in New Hampshire and have overlapping operations.

??Our investigation found that these employers were intentionally misclassifying workers as independent contractors instead of ??employees?? to avoid paying them time-and-a-half for overtime hours they worked,?? said George Rioux, director of the Labor Department??s Wage and Hour Division district office in Boston. ??They paid the workers straight time for overtime hours and sometimes did not even pay for all hours worked. As joint employers, they switched workers among the companies in a further attempt to avoid the requirements of the law. Such behavior by any employer will not be tolerated by the Labor Department.??

According to the Department of Labor??s press release ??the defendants agreed to entry of the judgment without admitting liability.?? As part of the judgment, Jerry Poulin is prohibited from ??serving in the future as an owner, director or executive of any business entity covered by the FLSA.??

Manchester Union-Leader reports here. Nashua Telegraph story here.

Obama administration could aggressively tackle 1099s Posted by on

Former Clinton Chief of Staff John Podesta, who is running President-elect Barack Obama's transition team, was previously heading a think tank which will recommend to Obama that the top priority of the Department of Labor should be tackling the issue of worker misclassification. It is a significant sign that workers, both union and nonunion, will enjoy greater protection under an Obama administration.

At an event on Monday in Washington titled "Putting Workers First," the Center for American Progress will release reports that address the misclassification issue as well as the Department of Labor's handling of other issues, such as worker safety, federal contracting and the treatment of immigrant workers.

The reports will detail specific ways the Executive Branch can make progress right away and recommends things that can be moved through congress. Many of them mirror what has been implemented in New England states recently, such as opening the doors for multiple agencies to share information and cooperate on investigations.

For eight years, the Bush administration and the Department of Labor have reduced investigations and enforcement, instead relying on ??voluntary compliance?? with many laws that protect workers. That is expected to change dramatically under Obama.

In addition to changing the culture of enforcement at important federal agencies to more aggressively protect workers, many expect fines levied against employers who violate those protections to be increased, to discourage future violations.

Kara Walter, a policy director for the CAP, said the group thinks ??misclassification is an item the Obama administration can work on immediately. Some of it is covered under the Fair Labor Standards Act," Walter said. "We are definitely looking at innovations. And we think that the focus on worker protection and regulation can be
accomplished with executive powers that can be used without the immediate need for legislation."