States Join Feds in Pay Inquiry

Labor Dept. combines forces with 11 states to crack down on employee misclassification.

The Obama administration and 11 states will join an effort to crack down on companies such as homebuilders, hotels and restaurants that classify employees as independent contractors to avoid paying overtime.

The Labor Department and states agreed to share information filed by companies as the department finds and prosecutes companies that misidentify workers in order to skirt paying unemployment benefits or federal taxes, according to Mike Wald, an agency spokesman.

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