Task force studies misclassification of construction employees in Tennessee

A new task force launched last year by the Tennessee Department of Labor and Workforce Development has completed its review of the way local contractors classify their workers, The Chattanoogan reports. Employee misclassification, which is prevalent in the construction industry, happens when workers are noted as being independent or are paid in cash.

Between 21,000 and 37,000 misclassified and unreported construction workers were employed by the industry nationwide in 2006, with approximately 11 percent to 22 percent of sector employees in Tennessee falling into this category. Uncollected revenues from federal programs such as social security and federal income tax exceed $50 million using conservative figures.

"This type of practice is unfair to those companies who are playing by the rules and lose competitive bids, and it creates a burden on employees who are not covered by workers' compensation coverage should they get injured on the job," Commissioner Karla Davis told The Chattanoogan.