Productions Are Increasingly at Risk of Being Penalized for Crew Misclassification

Recently, the New Jersey Department of Labor & Workforce Development announced it has entered into a memo of understanding with the U.S. Department of Labor to share information and coordinate enforcement efforts pertaining to employers incorrectly treating employees as independent contractors. New Jersey is now one of 44 states that have agreed to share worker misclassification information with the Department of Labor.

What does this mean for the production industry? That it’s now potentially even more costly to treat crew members as independent contractors, rather than processing them through payroll as employees. This misclassification is common in our industry, and this news underscores the fact that, as the methods of identifying and penalizing violators become increasingly sophisticated, production companies run a greater risk of getting caught.

GreenSlate consistently warns producers about this potential issue. It’s important to understand what criteria an independent contractor needs to meet, and to document your proof before designating them as such. More often than not, crew members should be designated as employees, so think carefully and proceed with caution before deciding they aren’t. And remember: even if you have the paperwork to back up your decision, the Department of Labor has the last word—and in this case, it’s very rarely, if ever, on your side.

If you have any questions about employee classification, or any other queries related to payroll processing, contact GreenSlate at info@gslate.com.