Some businesses wrongly classify workers to avoid payroll taxes

Lots of employers in these tough economic times are illegally cutting costs by misclassifying some workers as independent contractors.

The tactic — used in an array of industries from home construction to information technology — is sapping millions of dollars from the state’s unemployment-insurance fund, tax coffers and workers’ compensation fund, say Utah regulators. It’s also making it difficult for aboveboard companies to compete.

Officials in charge of investigating the various violations involved say they can’t do much about the problem. The same shaky economy that makes it tempting for employers to illicitly shave expenses is leaving regulators with staffs far too small to nab thousands of offenders.

By Sheena Mcfarland

Full Story: http://www.sltrib.com/business/ci_12486194