[Federal Register Volume 78, Number 8 (Friday, January 11, 2013)]
[Notices]
[Pages 2447-2449]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-00389]


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DEPARTMENT OF LABOR

Wage and Hour Division


Proposed Information Collection Request (ICR) for the Worker 
Classification Survey; Comment Request

AGENCY: Wage and Hour Division, Labor.

ACTION: Notice.

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SUMMARY: The Department of Labor (DOL), as part of its continuing 
effort to reduce paperwork and respondent burden, conducts a 
preclearance consultation program to provide the general public and 
Federal agencies with an opportunity to comment on proposed and/or 
continuing collections of information in accordance with the Paperwork 
Reduction Act of 1995 (PRA95) [44 U.S.C. 3506(c)(2)(A)]. This program 
helps to ensure that required data can be provided in the desired 
format, reporting burden (time and financial resources) is minimized, 
collection instruments are clearly understood, and the impact of 
collection requirements on respondents can be properly assessed. The 
Department is soliciting comments concerning its proposal to collect 
information about employment experiences and workers' knowledge of 
basic employment laws and rules so as to better understand employees' 
experience with worker misclassification. A copy of the proposed 
information request can be obtained by contacting the office listed 
below in the FOR FURTHER INFORMATION CONTACT section of this notice.

DATES: Written comments must be submitted to the office listed in the 
addressee section below on or before March 12, 2013.

ADDRESSES: You may submit comments by either one of the following 
methods: Email: WHDPRAComments@dol.gov; Mail, Hand Delivery, Courier: 
Division of Regulations, Legislation, and Interpretation, Wage and 
Hour, U.S. Department of Labor, Room S-3502, 200 Constitution Avenue 
NW., Washington, DC 20210. Instructions: Please submit one copy of your 
comments by only one method. All submissions received must include the 
agency name and Control Number (or other identifier) identified above 
for this information collection. Because we continue to experience 
delays in receiving mail in the Washington, DC area, commenters are 
strongly encouraged to transmit their comments electronically via email 
or to submit them by mail early. Comments, including any personal 
information provided, become a matter of public record. They will also 
be summarized and/or included in the request for OMB approval of the 
information collection request.

FOR FURTHER INFORMATION CONTACT: Karen Livingston, Director, Division 
of Strategic Planning and Performance, Wage and Hour Division, 200 
Constitution Avenue NW., Frances Perkins Bldg., Room S-3510, 
Washington, DC, 20210, telephone number (202) 693-0023 (this is not a 
toll-free number).

SUPPLEMENTARY INFORMATION:
    Background: The purpose of this study is to design and administer a 
new survey to collect information about employment experiences and 
workers' knowledge of basic employment laws and rules so as to better 
understand employees' experience with worker misclassification. This is 
the first time DOL will field a survey to examine worker 
classification. The survey instrument utilizes and adapts existing 
survey questions, as well as incorporates new questions specific to 
this study. The data collection effort with this group will gather 
information about workers' employment and pay arrangements and will 
measure workers' knowledge about their current job classification, and 
their knowledge about the rights and benefits associated with their job 
status. Worker misclassification can be understood as

[[Page 2448]]

the practice, intended or unintended, of improperly treating a worker 
who is an employee under the applicable law as in a work status other 
than an employee (i.e., an independent contractor). As a result, 
employees are deprived of their legal wage entitlements, including 
minimum wage and/or overtime, as well as programs like unemployment 
insurance and workers' compensation, because such programs generally 
apply only to ``employees'' rather than workers in general. Federal 
labor laws do not require employers to inform workers of their 
employment status (whether the worker is an employee or not), the basis 
for their status determinations, or pay (including hours worked, pay 
rates, and wages paid). As a result, workers may not be prepared for 
the consequences of misclassification.
    Employers who misclassify workers may achieve significant 
administrative and labor cost reductions, giving them a profound 
advantage over employers that properly classify their workers as 
employees. According to one estimate, if only one percent of all 
employees were misclassified nationally, the loss in overall 
unemployment insurance revenue due to underreporting would be nearly 
$200 million dollars annually.\1\ This may be an underestimate; some 
states report losing between 5 and 20 million dollars annually on 
unemployment insurance payments alone.\2\ The GAO estimates that unpaid 
taxes total more than $2.7 billion dollars per year in unpaid Social 
Security, unemployment insurance, and income tax due to 
misclassification.\3\ A 2000 DOL commissioned study found that 10 to 30 
percent of firms audited for state unemployment insurance had one or 
more of its employees misclassified as independent contractors.\4\ 
Since 2009, Wage and Hour investigators have collected over $29 million 
in back wages for over 29,000 employees who were not paid in compliance 
with federal law because they were misclassified as independent 
contractors.
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    \1\ GAO-09-717 and Planmatics, Inc. Independent Contractors: 
Prevalence and Implications for Unemployment Insurance Programs. 
February 2000.
    \2\ Statement of Seth D. Harris, Deputy Secretary, U.S. DOL, 
before the Committee on Health, Education, Labor, and Pensions of 
the U.S. Senate. June 17, 2010.
    \3\ GAO-07-859T and Upper Midwest Employment Law Institute, 
2010.
    \4\ GAO-09-717 and Planmatics, Inc. Independent Contractors: 
Prevalence and Implications for Unemployment Insurance Programs. 
February 2000.
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    This survey will provide critical information to Department 
policymakers on whether workers have knowledge of their employment 
classification and whether they understand the implications of their 
classification status. The primary tasks of the survey include: (1) 
design and cognitively test survey questions to be used for worker 
classification survey, (2) develop sampling methodology that will 
generate nationally representative samples of workers (or as close to 
nationally representative as possible), (3) conduct in-depth interviews 
of employers and employer groups to explore employer knowledge, 
attitudes, and practices around classifying workers, and (4) execute 
the survey, analyze the data and report the results. The period of 
performance of this evaluation is 30 months ending in March 2014. The 
overall budget for the evaluation is $1,852,029. The evaluation 
contractor is Abt Associates.
    2. Desired Focus of Comments: Currently, the Department of Labor is 
soliciting comments concerning the above data collection. Comments are 
requested that:
     Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
     Evaluate the accuracy of the agency's estimate of the 
burden of the proposed collection of information, including the 
validity of the methodology and assumptions used;
     Enhance the quality, utility, and clarity of the 
information to be collected; and
     Minimize the burden of the information collection on those 
who are to respond, including the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submissions of responses.
    3. Current Actions: Pursuant to the PRA implementing regulations at 
5 CFR 1320.8(d)(1), this notice requests comments on the proposed 
information collection request discussed above in the Background 
section of this notice. Interested parties are encouraged to provide 
comments as described in the ADDRESSES section above.
    Agency: Wage and Hour Division.
    Type of Review: New Collection.
    Title of Collection: Worker Classification Survey.
    OMB Control Number: [Insert OMB Control Number].
    Affected Public: Individuals or households.
    For Worker Survey:

Annual hour burden:
    Screeners--17,906 households x 5 minutes each.....             1,492
    Extended interview--10,060* x 15 minutes..........             2,515
                                                       -----------------
        Total Burden (10,060 respondents).............             4,007
                                                       =================
Main Survey Annualized cost to respondents: (4,007               $93,282
 hours at $23.28** per hour)..........................
    200 Non-response interviews x 5 minutes each......             16.66
    Annualized cost to respondents (16 hours at $23.28              $388
     per hour)........................................
                                                       -----------------
        TOTAL ANNUALIZED Cost to Respondents:.........           $93,670
 
* Includes sixty (60) pre-test cases.
** U.S. Department of Labor, Bureau of Labor Statistics, Table B-3.
  Average hourly and weekly earnings of all employees on private nonfarm
  payrolls by industry sector, seasonally adjusted (accessed from the
  following website as of January 2012: http://www.bls.gov/webapps/legacy/cesbtab3.htm).

    In-depth Interviews:

Annual hour burden:
    Recruitment (includes calls and review of                         25
     materials) 100 executives x 15 minutes each......
    In-depth interviews--20 @ 60 minutes each.........                20

[[Page 2449]]

 
        Total Burden (20 respondents).................                45
Annualized cost to respondents: (45 hours at $84.88*              $3,820
 per hour)............................................
 
* U.S. Department of Labor, Bureau of Labor Statistics, Table B-3.
  Average hourly and weekly earnings of all employees on private nonfarm
  payrolls by industry sector, seasonally adjusted (accessed from the
  following website as of January 2012 (http://www.bls.gov/news.release/ocwage.t01.htm).

    Comments submitted in response to this request will be summarized 
and/or included in the request for OMB approval; they will also become 
a matter of public record.

    Signed: at Washington, DC this 8th day of January, 2012.
Mary Ziegler,
Director, Division of Regulations, Legislation, and Interpretations, 
Wage and Hour Division, U.S. Department of Labor.
[FR Doc. 2013-00389 Filed 1-10-13; 8:45 am]
BILLING CODE 4510-27-P