NH Labor Department Targets Misclassification of Employees

Monday, November 25, 2013

James W. Craig, the new Commissioner of the New Hampshire Department of Labor, addressed the Labor & Employment Section of the New Hampshire Bar Association on November 19, 2013.  Mr. Craig indicated that his chief enforcement priority is misclassification of employees as independent contractors.  He intends to bring “the hammer down” on those who violate the law.  The Department has freed up two investigators who can respond quickly in the field to potential issues and is making Spanish-speaking investigators more available to facilitate communication in the field.  The Commissioner has hired a new lawyer to assist in prosecuting cases, to avoid adverse results at hearings or reductions in proposed fines.  The Department is also becoming more aggressive in collecting unpaid fines.  The Commissioner cautioned that he is not targeting the “mom and pop” businesses who are trying to do things by the book, but who may have made honest mistakes; he is targeting those who intentionally skirt the law or who are repeat offenders.

RSA 275:4,II essentially treats every person who is engaged in employment as an employee.  Only those who meet all of the seven criteria under the law may be treated as independent contractors.  It is very difficult to meet all of the criteria under the law.  With this emphasis on pursuing offenders and imposing heavy fines, employers should take great care to ensure compliance with RSA 275:4 before treating any worker as an independent contractor.