September 5, 2013

State Says It Recovered $21M In Employer Fraud, Worker Misclassification

The state said it recovered more than $21 million from mid-2011 through 2012 in back wages, taxes, fines and penalties related to employer fraud and worker misclassification.

According to Labor and Workforce Development Secretary Joanne F. Goldstein, the money collected exceeded the sum of what was taken in during all previous years combined.

The commonwealth recouped $21.39 million in owed revenue and ensured greater compliance with the state's labor, licensing and tax laws, according to a statement from the Executive Office of Labor and Workforce Development (EOLWD).

Over the 18-month period, the state recovered more than $17 million from employers in unpaid unemployment taxes. Of this $17 million, close to $13 million was generated in 2012 alone, nearly double the amount collected in 2011.

The results come from the collaborative work of the state's Joint Enforcement Task Force on the Underground Economy and Employee Misclassification, also known as the Joint Task Force, which includes representatives of EOLWD, as well as the offices of the attorney general, the Alcoholic Beverages Control Commission and the Insurance Fraud Bureau.

"The collaborative efforts of the Joint Task Force have worked successfully to bring businesses and individuals into compliance with our state laws," said Attorney General Martha Coakley. "The money recovered this year demonstrates both the scope of the problem and our aggressive response to combat fraud and abuse. As the state's sole wage enforcement authority, our office will continue to take action to protect workers, stop unlawful business practices and level the playing field for all companies."

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