This marks the first time the DOL has awarded grants to states dedicated to curbing misclassification.  However, the DOL’s stepped up enforcement of worker misclassification has been ongoing for several years and cooperation between the DOL and state agencies is nothing new.  For example, several states, including California and New York, have entered into formal Memoranda of Understanding with the DOL to share information regarding independent contractor misclassification, opening employers up to both federal and state liability from a single investigation.

These grants show that the DOL and state governments’ interest in worker misclassification is not waning.  Employers who have not already closely reviewed their independent contractor relationships should consider performing a privileged audit in order to assess the risk they may have of misclassification claims.