The Payroll Fraud Prevention Act was introduced by Senator Sherrod Brown (D-OH) on April 8, 2011. This bill is in the first step of the legislative process. A similar bill, Employee Misclassification Prevention Act, proposed by the same Senator on April 22, 2010, did not come up for debate and never became law. It is not uncommon for a sponsor to reintroduce bills that were not debated.
If enacted, Payroll Fraud Prevention Act would require employers to provide written notice to employees and "non-employees" (aka - a person engaged, for the performance of labor or service, who is not an employee) that provides the following information:
- Their employee/non-employee classification;
- Direction to a Department of Labor Website for further information on the rights of employees under the law;
- The address and telephone number for the applicable local office of the Department of Labor;
- For individuals classified as non-employees, this statement: 'Your rights to wage, hour, and other labor protections depend upon your proper classification as an employee or non-employee. If you have any questions or concerns about how you have been classified or suspect that you may have been misclassified, contact the U.S. Department of Labor.'
Maintaining copies of these notifications would also be required if the bill is enacted along with a created presumption that if individuals are not notified they are employees.
Click here to read the entire bill and track the status.
This information is intended to be educational and should not be considered legal advice on any specific matter.
