Section 3-904 - Knowing failure to properly classify employee. - Maryland Statutes

§ 3-904. Knowing failure to properly classify employee.
 

(a)  Prohibition.- An employer may not knowingly fail to properly classify an individual who performs work for remuneration paid by the employer. 

(b)  What constitutes knowing failure to classify.- An employer has knowingly failed to properly classify an individual when: 

(1) an employer-employee relationship exists as determined under § 3-903(c) of this subtitle; and 

(2) the employer has knowingly failed to properly classify the individual as an employee. 

(c)  Evidence.- The Commissioner shall consider, as strong evidence that the employer did not knowingly fail to properly classify an individual, whether: 

(1) before a complaint was filed against the employer or the Commissioner began an investigation of the employer, the employer: 

(i) sought and obtained evidence that the individual: 

1. is an exempt person; or 

2. as an independent contractor: 

A. withholds, reports, and remits payroll taxes on behalf of all individuals working for the independent contractor; 

B. pays unemployment insurance taxes for all individuals working for the independent contractor; and 

C. maintains workers' compensation insurance; and 

(ii) provided to the exempt person or independent contractor a written notice as required by § 3-914 of this subtitle; or 

(2) the employer: 

(i) 1. classifies all workers who perform the same or substantially the same tasks for the employer as independent contractors; and 

2. reports the income of the workers to the Internal Revenue Service as required by federal law; and 

(ii) has received a determination from the Internal Revenue Service that the individual or a worker who performs the same or substantially the same task as the individual is an independent contractor. 

(d)  Regulations.- The Commissioner shall adopt regulations to provide guidance as to what constitutes the evidence relevant to the determination of whether an employer knowingly failed to properly classify an employee. 
 

[2009, ch. 188.]