Builders Face More Scrutiny Over Pay
Builders Face More Scrutiny Over Pay
Seven states and the IRS have announced they also will join the Department of Labor in a review of hiring and pay practices of home builders, The Wall Street Journal reports.
Home builders have recently faced a broad review of their pay and hiring practices after recent investigations by the Labor Department turned up violations of labor laws by some firms, including denying workers minimum wages, overtime pay, and benefits. Several builders also are facing questions over whether they have been misclassifying workers as independent contractors, rather than employees.
The IRS has joined the investigation because employers who don’t pay payroll taxes on workers classified as independent contractors may be side-stepping thousands owed in taxes.
"You've got an industry that's almost singularly responsible for keeping our economy in the doldrums,” says Jerry Howard, president of the National Association of Home Builders. “To pick this time to do these types of investigations, it's counterproductive to the health of the economy.”
Some of the nation’s largest home builders received a letter last month seeking pay and employment records, as well as the names of all contractors hired in the past year. The Labor Department is also investigating other industries, including hospitality, day care, health care, and others.
Source: “States, IRS to Join Probe of Home-Builder Pay Practices,” The Wall Street Journal (Sept. 17, 2011)
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