For years, businesses have struggled with properly identifying workers as either independent contractors or W-2 employees. The hundreds of thousands of jobs created by the gig economy has complicated matters even further. Over the years, administrative bodies have attempted to craft tests to be used in the classification process. These tests, in many respects, have not been helpful. Our courts, too, have attempted to solve the riddle, but have largely been unsuccessful due to inconsistent rulings. As a result, businesses that have attempted to properly classify workers in good faith have found themselves in hot water with the Internal Revenue Service and state taxing authorities, state employment departments, workers’ compensation boards, and the courts.
Several weeks ago, we asked if the concept of portable benefits for gig economy workers was one step closer to reality, with rumors swirling of imminent federal legislation forthcoming. Well, this issue just took a big leap forward with the introduction of legislation by Senator Mark Warner (D-Virginia).