This past January I posted on an Iowa immigration bill that targeted employers.  The bill sparked significant debate but was not passed.

Now in the wake of the raid at the AgriProcessors slaughterhouse and packing plant in Postville, Iowa, Iowa’s legislative leaders are renewing promises to target employers.

This time legislative leaders will introduce legislation to prevent employers from hiring immigrant workers as independent contractors when they should be considered employees.  It is also anticipated the legislature will renew efforts to create sanctions on employers that knowingly hire undocumented workers.

I have written on the issues relating to employees and independent contractors on several occasions.  The issue of whether a worker is an employee or independent contractor is one of the most misunderstood (or should I say ignored) areas of the law.  The proposed legislation is likely to crack down on the use of illegal immigrants serving as independent contractors in the construction industry. 

In my experience a significant percentage of workers in the construction and other industries are misclassified as independent contractors rather than employees, not just illegal immigrants.  For most companies I would argue it’s more about saving on payroll taxes and workers’ compensation insurance than hiring undocumented illegal immigrants.    

As I have said in the past, the approach of misclassifying workers as independent contractors is not worth the risk.  The safest course is to treat workers as employees if the workers’ status as an independent contractor could reasonably be questioned. 

If you have questions about whether to treat workers as employees or independent contractors be sure to consult with an employment lawyer.