Pennsylvania Construction Workplace Misclassification Act Compliance


In October 2010 Pennsylvania Gov. Ed Rendell signed into law Pennsylvania’s new Construction Workplace Misclassification Act (CWMA), which places new regulations on construction companies operating in Pennsylvania and further delineates the difference between an independent contractor and an employee.

Under the new law, construction companies may only classify a worker as an independent contractor if the individual:

Has a written contract to perform the services;

Does not direct or have control over the performance of such services, both under the contract and in fact; and

Is customarily engaged in an independently established trade, occupation, profession or business with respect to the services to be performed.

To establish this third prong, this means that an independent contractor must:

Possess the necessary tools or equipment to perform the services;

Perform the services through a business in which he or she has an ownership interest;

Have an arrangement whereby he or she may enjoy a profit or suffer a loss by rendering such services;

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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