English

Staffing company again violates wage laws thousands of times

the Auditor at your service

Timothy M. O’Brien, CPA, Auditor of Denver

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My Denver Labor team has determined gig staffing company Instawork committed more than 20,000 violations of employees’ basic wage and hour rights under the city’s minimum wage and civil wage theft ordinances and now owes a total of $2,354,636.28 in restitution, penalties, and fines.

Earlier this year, we determined Instawork broke Denver’s wage laws thousands of times earlier this year by misclassifying nearly 3,000 people as independent contractors.

To be considered an independent contractor, a worker must be free from the employer’s control, not subject to their conduct rules, and must run their own independent business or trade. This means they should have functional independence of being in business for themselves.

Since May, Denver Labor has also been investigating Advantage Workforce Services, LLC, for wage and hour violations. We found Advantage Workforce is the same entity as Instawork and it failed to pay Denver’s minimum wage and overtime to hundreds of workers. It also routinely denied paid sick and safe leave to employees.

My office recovers $500,000 for workers to start the year Auditor's Office Works for You

Stop payroll data

According to the new determination, Instawork withheld an extraordinary amount of payroll data that we specifically requested in our first investigation. This missing information included documentation of more than 14,000 shifts for 1,450 employees. Instawork claimed these employees worked for Advantage Workforce Services, which we determined is not a separate company.

When employees are misclassified as independent contractors, they are denied critical workplace protections and frequently have their wages stolen. They often suffer minimum wage and overtime violations, can’t take paid rest breaks, and don’t receive paid sick leave. If they get injured, they can’t take advantage of workers’ compensation. If they lose their jobs, they aren’t protected by unemployment insurance.

Bad consequences for good employees

Furthermore, when these staffing companies illegally misclassify and underpay their employees, they are undercutting fair competition and harming good employers in a decades-old industry throughout Denver.

Misclassification is incorrect and illegal, and it happens with people working frontline jobs, around food, in warehouses, or in cleaning services. If you believe you have been misclassified as an independent contractor within the City and County of Denver or are a victim or wage theft, my team can help. Contact us through our website DenverWages.org or call (720) 913-9143.