IBEW Local 520 is aware of investigations across the country that have uncovered numerous examples of construction contractors improperly classifying employees as “1099” Independent Contractors. For the employee, including many electricians, this illegal practice often leads to lower wages and little to no benefits, not to mention setting them up for problems, which may go well beyond dealing with the Internal Revenue Service.
Misclassifying employees also creates an unfair advantage for the law-violating contractor.
For tax purposes, an independent contractor is often listed as a “1099 employee.” This means an individual may work for a company and receive a paycheck, but the company does not have to withhold various taxes, contribute to Social Security or Medicare or provide any health or retirement benefits. In some states, premiums for workers’ compensation or unemployment insurance are also not required for anyone listed as a 1099 employee.
This means the worker is responsible for paying these fees and taxes, not to mention performing their own withholding through quarterly payments to the IRS. In some instances, the employee is not even aware of the situation.
To determine the difference between an employee and an independent contractor, please click here.
The members of IBEW 520, are not Independent Contractors. All our licensed electricians are covered by a Collective Bargaining Agreement.
Local 520 Collective Bargaining Agreement
Being covered by a Collective Bargaining Agreement (CBA), such as the one negotiated by IBEW Local 520, grants the electrician certain rights. If something were to happen on-the-job, they have support and protection of the union, through the CBA.
Under the Local 520 CBA, all signatory contractors provide workers’ compensation to workers, who are injured on-the-job. Being unable to work because of an on-the-job injury, and not being eligible for workers’ compensation leaves you and your family in financial risk.
Other benefits provided under a CBA include fully-paid health insurance and retirement benefits. Independent contractors are forced to purchase their own insurance and set aside money for their own retirement plan.
IBEW 520 strongly encourages licensed electricians to work under a CBA in order to ensure they receive benefits and on-the-job safety, but also a steady income to provide for you and your family.