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4/30/2011
KH Law
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New Payroll Fraud Prevention Bill: What it means for Texas Workers

Employee misclassification costs employees hundreds of thousands of dollars every year. In an attempt to crack down on employers who intentionally misclassify their employees, a new bill introduced this year would expand the Fair Labor Standards Act (FLSA) protections for employees. The new bill aims to reduce worker misclassification in several ways. The bill, if enacted, would apply the following new rules.

-Make employers keep accurate records stating whether each worker is an employee or non-employee and why.
-Require employers to notify workers of their classification and direct them to a Department of Labor website with information about the employee rights.
-Create up to $5,000 penalties per worker for notice requirement violations or for misclassifying employees as non-employees.
-Subject employers to triple damages for willful violations of the minimum wage and overtime laws when workers are misclassified.


When employers misclassify employees, it is considered a form of "payroll fraud." Employers who misclassify employees do not pay certain federal, state and local taxes.

The Labor Department estimates that 30 percent of companies misclassify employees as independent contractors. If you believe you are one of them, read our article to find out if you have been misclassified.

Blog post: Have you been Misclassified as an Independent Contractor in Texas?

Watch our video: Learn the Top 10 Overtime and Wage Myths



Category: General



The Texas overtime lawyers at Kennedy Hodges represent workers nationwide and across Texas in:
Houston, Dallas, Austin, San Antonio, Fort Worth, Pasadena, Laredo, Sugar Land, Lubbock, Illinios, New York, Massachusetts, Los Angeles, Chicago, Philadelphia, Phoenix, San Diego, San Jose, Jacksonville, Indianapolis, San Francisco, Columbus, Charlotte, Detroit, and more.




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