Governor Paterson Signs the Construction Industry Fair Play Act

Albany, NY (September 03, 2010) –
Governor Paterson has signed into law the Construction Industry Fair Play Act, which creates a clear litmus test to distinguish the difference between a worker and an independent contractor. It also provides a method to clearly define which business on a construction project is responsible for which workers. Finally, for the first time in State history, it imposes monetary and criminal penalties specifically for the act of employee misclassification on construction projects. “Studies have shown that up to 15 percent of New York’s construction industry is misclassified at any given time. Employee misclassification is a terrible practice that happens when a worker who should be considered an employee is improperly classified as an independent contractor or paid ‘off-the-books,’” Governor Paterson said. “It deprives the government of tax revenue at a time when it is sorely needed and places an unfair burden on law-abiding employers who play by the rules. It often deprives New York’s workers of crucial benefits such as overtime pay, workers’ compensation and unemployment insurance. This new law will be a powerful tool that hopefully will clean up this practice once and for all.”

Senator George Onorato said: “The Fair Play Act will curb a long-standing problem for construction workers and law-abiding employers resulting from the misclassification of workers as independent contractors instead of as employees. Misclassification deprives workers of basic labor protections, including workers’ compensation coverage, unemployment benefits and the payment of prevailing wages. By approving this law, New York has recognized the need to protect thousands of construction workers throughout the State who are often taken advantage of by unscrupulous contractors. It is unconscionable that individuals who perform dangerous construction work with the understanding that they will receive workers’ compensation benefits if injured, or unemployment benefits if they lose a job through no fault of their own, should suddenly find themselves without any medical coverage or income. This legislation will right these wrongs and make New York a fair place to work for workers and law-abiding employers.”

Frank Spencer, Vice President of the United Brotherhood of Carpenters Eastern District, said: “I’d like to thank Governor Paterson and the New York State Legislature for enacting the Fair Play Act. New York has joined other states in the region and around the country that have clearly and substantively addressed the harm construction worker misclassification does to workers, good employers and taxpayers.”