Although in Alaska, The Department of Labor and Workforce Development fined a contractor $280,000 for failing to follow proper shoring and bracing procedures, leading to the death of a worker after a wall collapsed onto him during a demolition project. CA is much harder!
The contractor was also fined for misclassifying his employees—including the deceased employee—as independent contractors in an effort to avoid paying unemployment insurance, workers’ compensation insurance and payroll taxes. There is no such thing as a 1099 employee. There are set rules that govern if a worker is a subcontractor (1099) worker, or a w-2 worker. Beyond this issue it is also felony workers compensation fraud to avoid paying workers compensation on these workers unless they pass the test... just call and ask your GDI Insurance Broker for the rules we are happy to help.
Employers who mislabel independent contractors risk having to pay fines and overdue payroll taxes to the IRS. Furthermore, the state workers’ compensation agency could levy fines and press criminal charges. Also should one of these workers become injured the employer is responsible for the medical, loss of income and any disability themselves.