In April, Professional Janitorial Services Executive Don Dyer delivered testimony to the Texas House Business and Industry Committee, which is studying what more lawmakers might need to do to combat the problem of Misclassification and how prevalent this problem is in the janitorial industry.
What is Employee Misclassification?
Certain corporations have chosen to cut corners and pad their profits by misclassifying their workers as “contractors” when they should have been classified as “employees”. Employee misclassification is explicitly against the law, yet because of weak enforcement mechanisms there are virtually no tangible consequences for violating the law. This oversight has opened the doors to a whole host of unethical practices including wage theft, tax evasion, and employee exploitation.
According to Dyer, negative impacts also include an unethical cost advantage of 30-40% by janitorial companies who misclassify their workers, the evasion of federal income taxes, Social Security payments, Medicare payments, and unemployment taxes, and the hiring of undocumented workers since they are the easiest to exploit and intimidate.
Read his full testimony here.