US Labor Department and Vermont Department of Labor
sign agreement to protect workers from misclassification

Participants: U.S. Department of Labor, Vermont Department of Labor

Description: Officials from the U.S. Department of Labor and the Vermont Department of Labor have signed a three-year Memorandum of Understanding intended to protect employees' rights by preventing their misclassification as independent contractors or other non-employee statuses. Under the agreement, both agencies may share information and coordinate law enforcement.

Background: The MOU represents a new, combined federal and state effort to work together to protect the employees' rights and level the playing field for responsible employers by reducing the practice of misclassification. Vermont is the latest state agency to join this effort with the U.S. Labor Department. Alabama, Alaska, California, Colorado, Connecticut, Florida, Hawaii, Illinois, Idaho, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Minnesota, Missouri, Montana, New Hampshire, New York, Rhode Island, Texas, Utah, Washington, Wisconsin and Wyoming agencies have signed similar agreements.

More information on misclassification and the effort are available at http://www.dol.gov/misclassification/.

Quotes: "Misclassification deprives workers of their hard earned wages and undercuts businesses that follow the law. This agreement sends a clear message that we are standing together with the state of Vermont to protect workers and responsible employers."

— David Weil, U.S. Department of Labor Wage and Hour Division Administrator

"The misclassification of employees is prohibited by both federal law and Vermont state law. Misclassification undermines law-abiding businesses by creating an unfair advantage for non-compliant businesses when competing or bidding for work. Employees are adversely impacted when benefits such as minimum wage, overtime, family and medical leave, unemployment insurance, and workers' compensation are denied them because they are misclassified as independent contractors. I look forward to working closely with the U.S. Department of Labor to address this problem."

— Annie Noonan, Vermont Department of Labor Commissioner