Lawmakers Want to Further Penalize Employment Fraud

Feb 26, 2018

State Senator Frank Wagner, R-Virignia Beach, addresses the Senate during a session at the Capitol last week. Wagner is among a group of Republicans who supported a bill that would increase the penalties for employers who misclassify employees as independent contractors instead of full-time employees.
Credit AP Photo / Steve Helber

Lawmakers in Richmond are poised to crack down on employers who are cheating the system and their employees.

Worker misclassification. It sounds like a vague problem that might not amount to all that much. But lawmakers here in Richmond are very concerned about it. Karrie Delaney is a freshman delegate from Fairfax County, and she wants to increase the penalties for employers who misclassify employees as independent contractors instead of full-time employees.

“The way this is often identified as a problem is when an employee who thinks they are entitled to have worker’s comp will go and file a claim and find out oh your employer never actually claimed you as an employee even though by the current code that person should have been considered a full-time employee.”

The Virginia Chamber of Commerce opposed the bill. But Democrats were united in their support. And a number of key Republicans supported the effort, including Senator Frank Wagner of Virginia Beach, who chairs the Senate committee that heard the bill.

“Just from personal experience in the ship repair company, it goes on a lot more frequently than you care to think and it puts those that are trying to comply with the law at a competitive disadvantage when they go to bid on jobs.”

Delaney initially wanted to increase the penalty from $75 to $300. But after moving the bill through the sausage-making factory here in Richmond, she ended up increasing the penalty to only $100. The bill narrowly passed the Senate, where most Republican senators voted against it. It’s now headed to the governor.

This report, provided by Virginia Public Radio, was made possible with support from the Virginia Education Association.