Nebraska Worker Classification Bill Does Not Negatively Impact Trucking

Nebraska Gov. Dave Heineman signed a bill into law last week, ending the practice of misclassifying workers as independent contractors in the construction and delivery sectors.

Larry Johnson, president of the Nebraska Trucking Association, said the new bill will not have a negative effect on the trucking and delivery industries in the state, however.

If anything, Johnson said, the bill more clearly defines who has to comply, and it keeps current statutes intact governing the independent contractor status for delivery companies.

According to Johnson, when Omaha Sen. Steve Lathrop introduced the bill two years ago, "He invited us to the table." The association told Lathrop the law could have some unintended consequences, so the bill includes language to address those concerns.

Specifically, the legislation does not change the interpretation of independent contractor status as it related to tort liability or a workers' compensation claim. It also does not change the definition of an independent contractor set out by the Department of Revenue. In addition, delivery service employees who are exempt from unemployment insurance are classified as independent contractors. The bill also more clearly defines a motor carrier, Johnson adds.

The Teamsters Union issued a press release last week, praising the passage of the bill.

"Irresponsible employers who misclassify their workers put legitimate employers at a definite disadvantage," said Jim Sheard, secretary-treasurer of Local 554 in Omaha. "They also cost the state between $9 million to $18 million a year in additional tax revenue. We fought hard to make sure the bill covered the transportation and construction industries."

Employers who misclassify workers can be fined up to $5,000 per misclassified worker by the state.