Misclassification Task Force Has First Meeting

Wayne Goodwin

North Carolina Commissioner of Insurance Wayne Goodwin

Wayne Goodwin, the North Carolina Commissioner of Insurance, held the first meeting of the Governor’s Misclassification Task Force on September 20, 2012 in Raleigh. Commissioner Goodwin set the tone for the meeting by saying that the purpose of the Task Force was to solve a serious problem but not to get into fiinger pointing. He expects to issue a report early next year and will hold at least two other meetings to gather information.

Elaine Marshall, Secretary of State, and Pamela Young, Chair of the Industrial Commission, were present along with representatives from the Sheriffi’s Association, Public Safety, the Attorney General’s office, the Department of Labor, and the Administrative Office of the Courts. After taking several questions from Task Force members, Commissioner Goodwin recognized Carol Brooke and Harry Paye of the North Caroina Justice Center, who discussed statistics related to the significant number of misclassified employees who have been discovered in other states. Milions of dollars in revenue, unemployment insurance and workers’ compensation insurance premiums have not been paid as a result of improperly classifying employees as indepednent contractors.

Doug Burton, the owner of a masonry company, addressed the Task Force and told of the widespread problem in his industry and how it is getting worse, which means that those employers who are abiding by the rules and deducting proper taxes are losing out on jobs to those who cheat the system. As a competitor told him recently: “The best thing to ever happen to my business was getting rid of all my employees.” The Task Force will look into a possible ban on “ghost policies” and possibly recommend a statutory definition of “independent contractor.” It will look at how state agencies can share data to identify misclassified employees. The next meeting will probably be in November but no date has been set.