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The Non-Union Scourge of Misclassified Construction Workers

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When non-union bosses misclassify their employees as independent contractors, they miss out on essential benefits that most of us enjoy.

According to new data from researchers at The Century Foundation, nearly 20% of the construction industry’s workers are misclassified. Misclassifying workers is a calculated move by employers to cut costs at the expense of workers' rights and legal protections. The unethical practice— which is not a problem in unionized construction— involves claiming employees as independent contractors instead of full time employees to dodge legal and financial responsibilities.

This illegal practice allows unscrupulous contractors to evade payroll taxes and circumvent labor laws and it costs workers an estimated $12 billion per year in underpaid wages and benefits. Desperate workers are often forced to turn to public services— the same public services their employers neglect to pay into— leaving taxpayers to pick up the tab.

The Toll on Workers

For the workers, the consequences of misclassification are dire. They lose out on essential benefits including healthcare, workers comp and unemployment insurance. Not to mention access to the rigorous training and apprenticeship programs union workers receive to keep them safe on the job and on a path to the middle class. In the dangerous world of construction, not having such benefits can quickly turn into a financial emergency if a worker is injured. Unfortunately, many are pushed into a spiral of debt and dependency on social assistance programs.

The Cost To Everyone Else

When non-union contractors lower costs by misclassifying workers they are lining their pockets at your expense. A study from UC Berkeley found that an astounding 39% of construction worker families depend on public safety net programs. Compounding the problem, tax-dodging contractors rob state and federal governments of revenue needed to fund the very programs their misclassified workers rely on. It’s estimated to cost taxpayers a whopping $28 billion annually.

When non-union contractors lower costs by misclassifying workers they are lining their pockets at your expense.

An Unfair Playing Field

Law-abiding businesses, like union construction outfits, are knee-capped when competing against non-union contractors who reduce labor costs through illegal means. It’s a testament to the skill and efficiency of union workers that, even with all the non-union shenanigans, union construction projects are still measurably cheaper. If it were a fair fight, non-union contractors would be left unable to compete. They would be forced to do the hard work of training and taking care of a reliable stable of skilled workers, the way New York City’s construction unions currently do. This outcome would benefit workers, improve construction quality and save taxpayers billions.

If you’re shopping for real estate in NYC, you can do your part to level the playing field by asking your real estate agent: who built this building?

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Mark Colangelo is a writer and blogger.

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