A new, quick and powerful enforcement tool has been used by the state Department of Labor to close down more than 85 work sites in Connecticut since last year, as officials target construction contractors with inadequate workers' compensation insurance.
Many of those hit with stop-work orders have misrepresented employees as independent contractors, underestimated payroll figures (sometimes by paying workers off-the-books cash) or misrepresented employee duties so as to avoid proper calculation of workers' comp coverage needs.
In the construction field, other state and federal agencies have authority to enforce workplace violations, but the process is invariably slow.
"This small little workers' comp measure is actually accomplishing more than all these federal and state agencies seeking out violators," Letizia said. "And it's doing it effectively, immediately and without the involvement of lawyers and courts."
"Once you misclassify someone as an independent contractor, you're not paying your share of Social Security, you're not paying unemployment tax, you're certainly not paying any overtime and are skirting the workers' comp requirement," he noted.
Donald Shubert, president of the Connecticut Construction Industry Association, said that dishonest contractors are hurting the law-abiding ones.
"A solid contractor will make a large investment managing their safety program, purchasing adequate coverage," Shubert said. "When other employers skirt the workers' comp requirements, [the law-abiding contractor] is at a tremendous disadvantage in bidding."
Letizia, a workers' comp lawyer who represents employers, said the Connecticut enforcement program is broadly beneficial.
"It's amazing when something works this well," he said. "Are we screwing business? No. Of the places shut down, no one's even asked for a hearing. So everyone has paid the fine and remedied the problem. That's the ideal of a good regulation.
"Any legitimate contractor would support this law. It evens the playing field so the crooks in the industry don't have an advantage."