Independent Contractor Compliance Blog - by Collabrus™

The November election resulting in President-Elect Obama and a strong Democratic majority in Congress will create a wind of change like we have not seen in…well…ever.  One big winner of this wind of change will be organized labor. For example, the new congress and President-Elect Obama are expected to enact the Employee Free Choice Act (EFCA).

Why do I say that?  Because Obama was a co-sponsor of the bill while a senator.  In a speech before the SEIU prior to the election, Obama vowed to pass the EFCA, stating: “We will pass the Employee Free Choice Act. We may have to wait for the next president to sign it, but we will get this thing done.”

EFCA would result in the most sweeping changes to the National Labor Relations Act since the 1935 Wagner Act.

A few of the provisions are:

• Require the National Labor Relations Board (NLRB) to certify a labor union as the exclusive bargaining representative by the use of authorization cards signed by employees and without the supervision and oversight of the government, (instead of the current practice of secret ballot with oversight);
• Require binding arbitration if an employer and a newly certified union are unable to reach a first contract in a timely fashion;
• Give the NLRB more powers in stopping employer unfair labor practices during union-organizing campaigns and during the initial bargaining process. This element also gives the NLRB the authority to impose penalties.

Employees can be unionized-Independent Contractors can not.

But before you reclassify all your workers to IC’s be sure that you do it right. I recommend you engage the services of a true expert.  Even the largest companies, with in-house attorneys, have made the mistake of thinking they can migrate their workforce from employee to Independent Contractor by just making a few adjustments in title and tasks.  A true expert will be able to advise you if your model will hold up under fire from the IRS, other enforcement agencies, or from civil lawsuits.  If not, an expert will be able to provide you with options to save money and misclassification risks.