On September 15, 2014, the Department of Labor (DOL) announced a program to reduce states’ worker misclassification. The DOL awarded nineteen states a total of $8.2 million “to detect incidents of worker misclassification and protect the integrity of state unemployment insurance trust funds." Maryland, New Jersey, Texas, and Utah were awarded an additional $2 million in “High Performance Grants” for having the most efficient or improved efforts in identifying worker misclassification, raising the total amount of DOL awards to $10.2 million.
This is the first year states received DOL grants under the competitive grant program. The DOL website quoted Secretary of Labor, Tom Perez, stating, "This is one of many actions the department is taking to help level the playing field for employers while ensuring workers receive appropriate rights and protections. Today's federal grant awards will enhance states' ability to detect incidents of worker misclassification and protect the integrity of state unemployment insurance trust funds."
Multiple state task forces have already been formed to address the issue. The National Conference of State Legislatures reports, “Legislation related to misclassification of employees as independent contractors was introduced in 34 states and the District of Columbia during the 2013 legislative session.”
The DOL award program is yet another indication of the seriousness of how state and federal governments are treating misclassification and their willingness to set aside funds to address the issue.