Clients are asking me if we have started receiving complaints from the Illinois Department of Labor relating to the harsh new Illinois law, the Employee Classification Act. Yes, we are starting to see these complaints coming in from the Illinois Department of Labor.
Under this new law, a company such as a construction company, a trucking company which hauls gravel or road building materials, a landscape company, and a wide variety of other construction related companies, can be challenged by the Illinois Department of Labor (IDOL) and "interested parties" on how the company classifies workers as either employees or independent contractors.
If the construction related trucking company who uses independent contractors is found in violation of the Illinois Employee Classification Act, the trucking company could be hit with substantial financial penalties, possible shut down of its business or job sites, and, most worrying to many, misdemeanor or felony criminal charges.
Below is the kind of wording we are seeing in these initial complaints:
Re: IDOL File No. 2008- ###/Request for Records
Please be advised that the Illinois Department of Labor (IDOL) has received a complaint, alleging that you have violated Illinois' Employee Classification Act, 820 ILCS 185, by misclassifying one or more individuals performing construction services on your behalf in connection with re-roofing a house at 123 ABC Street, St. Charles, IL.
In connection with its investigation of this complaint, and pursuant to its authority under Section 25 of the Act, IDOL hereby requests that within fifteen (15) days you make available or provide copies to IDOL of all records in your power, possession or control relating to your business relationship with the individual(s) performing services, including but not limited to:
- Their names, addresses, phone numbers and Social Security numbers;
- Any/all written agreements or contracts you have with them;
- Any/all records of days/hours worked;
- Any/all payroll or payment records; and
- Any federal and state documents related to the individuals performing services.
Failure to comply with this request for records may result in the issuance of a subpoena to compel production of the requested information. Furthermore, failure to comply with a valid IDOL order may result in the imposition of civil and/or criminal penalties, as prescribed in the Act.
Also note that if there is any additional information you wish IDOL to consider in its investigation of this matter, please submit information in writing to IDOL within 15 days of this letter.
We urge all trucking companies who use independent contractors to seek legal counsel regarding their usage of independent contractors-not just with regard to the Illinois Employee Classification Act, but also in terms of the IRS, the Illinois Department of Employment Security (IDES), workers' compensation, etc. Don't wait until you are hit with a complaint or an audit. Get legal advice early on in the game.
This is the period in Illinois history when it is particularly important for construction and construction-related companies to really sit down, take the time, and lower liability in every way possible . Your independent contractor agreement must be carefully drafted to be consistent with the Illinois Employee Classification Act and any other independent contractor laws from other Agencies. It is a time to carefully assess independent contractor relationships, contracts, and practices.
FREE INFORMATION: Readers can contact Legal Assistant Tammy Nelson at 630-377-1554 or firstname.lastname@example.org for a free copy of the Illinois Employee Classification Act, the adopted Rules, and the required Notice that must be posted. Please also visit our website at www.wesselssherman.com.
CONSULTATION: If you have any questions about the Illinois Employee Classification Act and want to evaluate your company's liability (and discuss ways to protect your company in its use of independent contractors), contact Senior Attorney and Shareholder Nancy Joerg at 630-377-1554 or email@example.com.