Legal Services Advocacy Project Makes Gains for Clients in Active Legislative Session

The 2023 legislative session was historic. The well publicized “trifecta” produced perhaps the most momentous and transformative set of legislation in Minnesota’s history. Many major advancements for legal aid's clients, and all Minnesotans, that were enacted include paid family leave and earned sick and safe leave time; codification of reproductive freedoms; passage of significant gun safety laws; a 100% carbon-free energy requirement by 2040; and a massive affordable housing funding bill, which includes a permanent rental assistance fund. 

While these broader issues captured headlines, the Legal Services Advocacy Project (LSAP) worked to pass a wide range of bills across a variety of substantive areas that made significant inroads in advancing protections for legal aid clients.  

  • Universal free breakfast and lunch for Minnesota students; 

  • Ending school suspensions for children in grades K-3;  

  • The first increase in General Assistance in 30 years; 

  • Giving survivors of domestic violence a path to relief from “coerced debt”;  

  • MFIP disregard for participants receiving RSDI; 

  • Major MFIP sanction reform and MFIP drug testing repeal; 

  • A massive Child Tax Credit;  

  • Banning school seclusion for children through 3rd grade; 

  • Funding to fully fund wage supports for persons with disabilities holding subminimum wage jobs;   

  • Extending the period within which to file a UI appeal to 45 days;  

  • Providing for an annual COLA to the housing assistance grant;

  • Extending MNCare coverage to undocumented persons;

  • Providing for recertifications once every 12 months for MA recipients;

  • Removing asset limits for persons applying for MA-EPD; 

  • Eliminating the requirement that tenants must pay back rent to assert a habitability defense;

  • Making eviction filings nonpublic until the court issues a final judgment;

  • Providing that the new 14-day pre-eviction notice is prima facie evidence of an "emergency" for purposes of emergency assistance eligibility;

  • Payday lending reform; and 

  • Eliminating the court-imposed bar to taking actions under the Consumer Fraud Act.

LSAP — which is comprised of staff attorneys Jessica Webster, Ellen Smart, and Ron Elwood — annually champions both discrete and systemic policy issues that fundamentally impact the lives of thousands of Minnesotans. They work with lawmakers, legislative staff, government agencies, legal aid staff, and dedicated partner advocacy groups to design, negotiate, and refine hundreds of new and existing laws, and always with legal aid’s clients and mission guiding their work.

Mid-Minnesota Legal Aid Tackles Worker Misclassification

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Worker misclassification occurs when a company labels a worker as an independent contractor, but state or federal law requires that worker to be treated as an employee. Why does it matter? Employment classification has huge stakes for both workers and employers. Workers who are classified as employees are ensured a slate of benefits and protections, from guaranteed overtime pay and minimum wage to unemployment and workers’ compensation insurance. They also typically pay less in taxes. Federal law requires employers to pick up the tab for half of a worker’s FICA taxes (a 15.3% tax that helps fund Social Security and Medicare), while independent contractors pay the full tax themselves. Add up these differences and employers stand to save about 30% on total labor costs by labeling workers independent contractors, leaving them without several critical social safety nets. 

In Minnesota, misclassification is widespread. 2007 data—the most recent Minnesota figures available—suggests that almost 15% of employers statewide misclassify at least 1 employee.  In certain industries, misclassification is even more rampant. The Minnesota Department of Labor and Industry found that one in three real estate, rental, and leasing companies had misclassified workers.

With the support of the Skadden Fellowship Foundation, MMLA’s low-income taxpayer clinic is thrilled to announce its Worker Misclassification Project. Eric Baudry, staff attorney and Skadden Fellow, will work with tax preparers to identify misclassification cases as workers receive help filing their taxes.

“An increased tax burden is among the most significant consequences for misclassified workers and receiving a 1099 instead of a W2 is one of the visible markers of misclassification,” Baudry said. “This makes tax preparation sites like Prepare and Prosper the perfect place to connect with misclassified workers in order to educate them about their rights and provide representation to increase their economic security.”

What will Baudry be looking for? Both state and federal laws dictate when a worker can be considered an independent contractor. “The IRS looks at factors like the employer’s control over the worker, the worker’s investment in the tools and materials needed for the job, and whether the worker is doing the kind of work typically done by the employer,” Baudry explained. “So, when we see an employer give explicit directions on how a job should be done, provide the tools the worker uses, and ask the worker to complete a project exactly in line with the company’s business model, but then the employer issues a Form 1099 instead of a W-2 when tax season comes around, it’s pretty clear there’s misclassification going on.”

Baudry anticipates that relationships with workers and worker advocates will also be critical to his project’s success. “Grassroots organizers and unions are often in the best position to educate workers about their rights and connect them with networks of supports,” Baudry noted. He looks forward to partnering with and supporting worker centers like Centro de Trabajadores Unidos en la Lucha (CTUL) and unions such as the North Central States Regional Council of Carpenters.  

The Worker Misclassification Project is eager to hear from you! If you have questions about misclassification, think that one of your clients might be misclassified, or want to refer a case, feel free to contact Eric. He can be reached by phone at (612) 746-3627 or by email at ebaudry@mylegalaid.org.

You can also learn more about the project in early March at State Support’s free CLE: Better Know A Program: Mid-Minnesota Legal Aid’s Worker Misclassification Project.