Tennessee Department Of Labor And Workforce Development Focuses On Tax And Insurance Fraud In Construction Industry

Wednesday, September 25, 2013

The Tennessee Department of Labor and Workforce Development is taking new measures to ensure employers in the construction industry are protecting workers who are injured on the job or need unemployment benefits.

Legislation that became effective July 1, gives the department the authority to issue civil penalties against construction service providers who have avoided workers’ compensation and unemployment insurance tax premiums.  The department will also refer cases involving business operations that are in violation of the law to the Tennessee Bureau of Investigation or the appropriate district attorney general for criminal investigation and prosecution.

The department will investigate employers who fraudulently misclassify employees as independent contractors, under-report the number of employees, under-report the amount of payroll, misrepresent the type of work performed, or make unlawful workers’ compensation deductions from employees’ salaries or wages.  Employers who pay workers “off the books” or in cash often do so in order to avoid proper classification of their workers.  The department will obtain Fraud Detection Software to assist in identifying potential suspects.   

“This will help level the playing field for construction companies that provide insurance for their employees, but end up losing bids when others cut corners,” said Labor Commissioner Burns Phillips. “The department continues to work with stakeholders including government agencies and employers to ensure the appropriate actions are taken.”

Companies proven to have committed fraud are subject to a penalty of $1,000 or one and one-half (1 ½) times the average yearly workers’ compensation premium minus the premium dollars paid on the policy that was the object of the understatement or concealment, whichever is greater.

Based on estimates there are between 21,990 and 36,680 misclassified and unreported construction industry workers.  In Tennessee, misclassified and unreported workers are estimated to range from 11 to 22% of all workers in the construction industry (Misclassified Construction Employees in Tennessee. Dr. William Canak and Dr. Randall Adams, 2010). 

At least 34 other states have enacted legislation to locate noncompliant employers and deter unlawful practices.

Those wishing to report suspected employee misclassification in the construction industry may contact the Fraud Tip Line at 888 243.7283. A fraud tip form, as well as information about misclassification, can be found at http://www.tn.gov/labor-wfd/EMEEF/misclass_main.shtml.  The public is also invited to participate in Employee Misclassification Advisory Task Force public meetings which are posted at https://apps.tn.gov/pmn/index.html.


March Housing Market Statistics

TVA Employees Teach Girls To Be UnBought And UnBossed

Form Based Code Committee Does Not Allow Large Building Signs For Westside Village


Nationally, increasing housing prices and housing affordability remained a concern in many markets, but locally sales prices and inventory levels remained steady. One big takeaway from March ... (click for more)

Two TVA employees were recently honored by Girls Inc. at the UnBought and UnBossed Awards. Nicci Brewer and Kayla Verner-Dingle were recognized for their career achievements and community ... (click for more)

The Form Based Code Committee decided on Thursday not to allow rooftop signs on two buildings that are part of the Westside Village in the southern portion of downtown around Chestnut and Pine ... (click for more)


Real Estate

March Housing Market Statistics

Nationally, increasing housing prices and housing affordability remained a concern in many markets, but locally sales prices and inventory levels remained steady. One big takeaway from March is the sharp increase in people listing their property for sale. New Listings in the Chattanooga region increased 8.2 percent to 1,282. Pending Sales were up 8 percent to 1,084. ... (click for more)

TVA Employees Teach Girls To Be UnBought And UnBossed

Two TVA employees were recently honored by Girls Inc. at the UnBought and UnBossed Awards. Nicci Brewer and Kayla Verner-Dingle were recognized for their career achievements and community involvement, which have positively impacted the lives of young women. Ms. Verner-Dingle is a TVA nuclear engineer who volunteers with the Girls Inc. Bookworm Program, Chattanooga Girls Leadership ... (click for more)

Breaking News

Walker County Commissioner Announces Erlanger Debt Will Be Paid In Full In Current Tax Cycle

Walker County Commissioner Shannon Whitfield said on Wednesday that the county will pay off its $8.7 million debt to Erlanger Health System within the current tax cycle. The announcement was made on Walker County's Facebook page and can be found here . The debt was incurred during the prior administration of Commissioner Bebe Heiskell, when she backed $10 million of an infusion ... (click for more)

Littlefield Proposes Using Portion Of Hotel/Motel Tax Funds To Operate New Homeless Shelter

Former Chattanooga Mayor Ron Littlefield is proposing that the city and county take $1 million each from the hotel/motel tax to operate a new homeless center. Mr. Littlefield told members of the County Commission on Wednesday that he believes it would be a justified use of the hotel/motel funds because restaurant and hotel operators often complain that homeless people are disturbing ... (click for more)

Opinion

How Can City, WWTA Get Away With Chronic Sewage Discharges Onto Our Streets?

A wastewater or service utility is simply a defined service in exchange for a fee. What if I pay a utility fee in exchange for a defined service, and the utility fails to deliver the service as agreed? As an example, I pay a private solid waste collection service to collect, transport, and dispose of garbage. Municipalities also operate waste collection and disposal. ... (click for more)

Roy Exum: Maddy’s Bigger Victory

There are two things that I suspect I am far better-versed than you are. The first is that after a half-century as an unquenchable student, my list of the greatest athletes in the history of UT athletics is better than yours. Oh, you can get the record books, the stat sheets, and an easy-to-find list of victories and do right well. But my edge is that I know what it took, the back-story, ... (click for more)