The Real Deal Miami

Department of Labor to crack down on law-breaking contractors

Cost Florida $400 million in lost tax revenue
January 14, 2015 12:30PM

Months after a Miami Herald investigation revealed Florida contractors broke state law and cheated on their taxes, the U.S. Department of Labor is teaming up with the Florida Department of Revenue to crack down on law-breaking contracting companies.

Between 2009 and 2013, a number of contracting companies cheated the system by treating their workers as independent contractors instead of permanent employees —  actions which resulted in taxpayers being cheated and law-abiding businesses being outbid, the Miami Herald reported.

A McClatchy study found that this type of misclassification also cost the government nearly $400 million in lost tax revenue in Florida alone.

The new agreement, announced in a news release Tuesday, calls for the state to share information and coordinate law enforcement activities with the Department of Labor.

“By partnering with the U.S. Department of Labor we are actively working to level the playing field for Florida’s businesses to stop the misclassification of workers,” Marshall Stranburg, executive director of the Florida Department of Revenue, told the Herald. “Businesses that misreport workers obtain an unfair advantage over other law-abiding businesses.” [Miami Herald] — Kristina Puga