2010

Disability discrimination claim by independent contractor (medical doctor) against private firm (hospital) may proceed, ninth circuit decides. Rehabilitation Act may not be limited to claims by employees. Independent contractors may state claims against the entities that hire them. January 2010 Report ---> click here to view --->   Janitors / franchisees did in fact receive remuneration from franchisor for unemployment tax purposes. State appeals court overruled decision of administrative law judge (ALJ). Matter remanded to ALJ to decide whether janitors fell within statutory independent contractor exclusion of the Oregon Revised Statutes. January 2010 Report ---> click here to view --->   IRS employment tax audit is discoverable in civil class action lawsuit. Court ordered FedEx to provide IRS Notice of Proposed Assessment. Notice found misclassification of drivers by FedEx. February 2010 Report ---> click here to view --->   Federal tax law permits employers to correct certain employment tax errors interest-free. To aid understanding, new IRS Revenue Ruling presents 10 hypothetical situations. Some of the hypotheticals deal with underpayment of employment taxes from worker misclassification as independent contractors. February 2010 Report ---> click here to view --->   Drivers filed class-action suit against limousine firm for alleged wage and hour law violations. Drivers alleged that firm failed to pay for on-call time between assignments. Court of appeal ordered trial court to certify two proposed driver subclasses. March 2010 Report ---> click here to view --->   Computer programmer is independent contractor for purposes of overtime and benefit laws. When he died, his estate sued claiming employee status, alleged unpaid overtime and other benefits. Defendants (health insurance company and information technology firm) successfully argued he was independent contractor thus not eligible for benefits or overtime. March 2010 Report ---> click here to view --->   Cab drivers sued cab company contending drivers / lessees were wrongfully classified as independent contractors and not as employees. The class action suit alleged denial of workers' compensation insurance, minimum wages, security deposits, meal and rest breaks. Court of Appeals, trial court agree matter should not be class action. April 2010 Report ---> click here to view --->   IRS rules nanny is employee, not independent contractor. Parent with children paid nanny, provided Form 1099-MISC. In response to nanny’s IRS Form SS-8, IRS determined employee status. April 2010 Report ---> click here to view --->   Alleged employer jumped the gun when it sued in superior court to set aside Employment Development Department assessment. California statutes do not provide for judicial review of the Appeals Board's reassessment decision. Employers must pay EDD assessment, file a claim for refund, exhaust administrative procedures, then sue for a refund. May 2010 Report ---> click here to view --->   IRS says musician is employee of church, not independent contractor. Church provided Form 1099-MISC each year. He played music at the church on Sundays. May 2010 Report ---> click here to view --->   Source code programmer was not independent contractor for purposes of Federal Copyright Act. He testified that he never considered himself an employee of firm. Subject worker found to be employee after court weighed "common law factors in light of circumstances.” June 2010 Report ---> click here to view --->   Oil and gas well consultants are not ICs according to Wyoming unemployment tax division. Unemployment Ins. Commission, Wyoming Supreme Court agree that subject workers were employees. Firm apparently did poor job with evidence; court noted documents prove that "eight consultants were paid remuneration but do nothing to prove they were ICs.” June 2010 Report ---> click here to view --->   Federal government report says workers misclassified as independent contractors add to tax gap. A significant percent of employers misclassify workers. Misclassification causes enormous tax losses for state and federal government. July 2010 Report ---> click here to view --->   Real estate agent is independent contractor as to real estate fees and commissions. Attempt by agent to assign income to his corporation resulted in this tax litigation. Agent failed to report the income on his Form 1040, Schedule C. July 2010 Report ---> click here to view --->   IRS, district court, appeals court all agree that these workers doing foundation repair, grading, and landscaping are not independent contractors. Late Form 1099s destroyed chance at section 530 safe harbor. Appeal court agreed that subject workers were common law employees and not independent contractors. August 2010 Report ---> click here to view --->   IRS, tax court agree, insurance premium field auditor is common law employee, not independent contractor. IRS determined auditor was an employee under the common law test. He completed Form W-4, received Form W-2 at year end; he was not entitled to deduct expenses on Form 1040, Schedule C. August 2010 Report ---> click here to view --->   Pest control firm used independent contractors, competitor cried foul and sued. Court says competitor lacks standing to sue for ruling that firm misclassified workers. Federal and state employment tax laws are enforced by government auditors and not disgruntled competitors. September 2010 Report ---> click here to view --->   Commercial cleaning firm sued competitor for worker misclassification and case did go to jury verdict. While finding misclassification, the jury did not find violation of unfair trade practices law. Defendant (competitor) treated workers as independent contractors and not as employees. September 2010 Report ---> click here to view --->   Court says it won’t consider late claim of independent contractor status in employment tax refund suit. In film industry case, payroll firm acted as employer, filed Form 941s, Form W-2s. IRS concentrated on identifying which entities, payroll firm or production firms, were common-law employers, not whether the workers were employees or independent contractors. October 2010 Report ---> click here to view --->   Court refused to compel workers to provide income tax returns. Workers sued employers alleging improper compensation. Employers sought discovery. Reason for seeking returns, to see whether they claimed independent contractor status, is not good cause for disclosure. October 2010 Report ---> click here to view --->   Seasonal, strawberry workers filed an action for overtime alleging multiple employers. Direct employer went bankrupt. California Supreme Court held produce merchants dealing with direct employer were not employers for California wage laws. November 2010 Report ---> click here to view --->   Massage therapists, cosmetologists, nail technicians held independent contractors, not employees. Spa charged weekly “booth rent,” the greater of $80 or 25 percent of gross revenues. Spa contended landlord / tenant relationship. Tax court disagreed but held independent contractor status anyway on common law grounds. November 2010 Report ---> click here to view --->   Drivers vs. Employer suit allowed for misclassification. Drivers claim firm misclassified to avoid FICA taxes. Husband / driver sought IRS determination on classification, allegedly let go in retaliation. December 2010 Report ---> click here to view --->   Co-owners and officers of hospital and related companies liable for $2.2 million in back employment taxes. Joint and several liability imposed for trust fund recovery penalties under IRC 6672. Trial and appeal courts agreed, they were responsible persons who willfully failed to pay over employment taxes. December 2010 Report ---> click here to view --->

[ Page updated: Monday, January 17, 2011 ]