Pa. House Labor & Industry Committee hears testimony on worker misclassification
Rep. Jason Dawkins June 11, 2024 | 12:11 PM
HARRISBURG, June 11 – The Pennsylvania House Labor and Industry Committee held an informational meeting today to hear from industry experts on the harmful effects worker misclassification has on Pennsylvania workers.
The committee heard testimony from Christopher Hallock, deputy secretary, Bureau of Safety and Labor-Management Relations, Department of Labor and Industry; Paul Prendergast, East Atlantic State Regional Council of Carpenters; Minister Rosilynn Gilliard, a driver with Spark Driver; and Julia Simon-Mishel, supervising attorney with Philadelphia Legal Assistance.
“Misclassification is a significant issue affecting Pennsylvania’s workforce and economy. A misclassified worker is denied essentially all workplace protections, most of which apply only to workers who are employees,” Hallock said. “Since 2023, approximately 300 misclassified employees were injured, resulting in $450,000 in lost compensation. Already in 2024, as of May 27, there have been 6,455 misclassified workers, resulting in $100.3 million in underreported wages and $1.7 million in underreported UC tax contributions.”
“In the construction industry, misclassification is unfortunately all-too-common,” Prendergast said. “This is not a union or non-union issue, a public vs. private construction issue, or even an issue solely for the victimized workers. Misclassification of workers is an issue that impacts every taxpayer in Pennsylvania. Through misclassification, contractors keep costs down by avoiding payroll taxes, unemployment and workers’ compensation insurance, as well as overtime and other employee benefits. In failing to pay their obligations, these burdens are then placed on the backs of the taxpayers.”
“As a driver with Spark, I am not free from control over how my services are managed. The Spark Driver app controls all aspects of my delivery work. Everything from the order in which my deliveries are made, to the prices customers are charged for said deliveries are set, ruled, and managed by the app,” Gilliard said. “If I encounter barriers that make it physically challenging or impossible to place deliveries where customers have specified, such as at the top of multiple flights of steps, on the side or behind a house or property at nighttime due to safety, I am penalized by the app’s metrics. There are still a plethora of ways in which I have no control over my work with Spark Driver yet upon signing up for employment, they make it immediately known that you are an independent contractor.”
“My experience representing gig workers as they were consistently denied unemployment, despite never having control over the end of their job, motivated me to pursue Lowman to the Supreme Court,” Simon-Mishel said. “In Pennsylvania, like in many states, misclassification of workers as independent contractors prevents them from accessing unemployment compensation when their employer lays them off or they are otherwise separated from employment. They are not ‘financially eligible’ because their employers have not reported their wages to the state database.
“Misclassification also often harms workers who start a part-time job, like driving for Grubhub, after losing qualifying full-time employment, because the state incorrectly disqualifies them as “self-employed’ when they report their earnings.”
“Worker misclassification is not only unethical and costly to the public, but it is also dangerous and deprives workers of their rights to fair compensation, protections from discrimination, workers’ compensation, unemployment compensation, the right to organize and more,” state Rep. Jason Dawkins, chair of the PA House Labor and Industry Committee said.