Can my employer take deductions from my pay for insurance and other business expenses?

No. In Connecticut, employers may not withhold any amount of money from an employee’s pay without written authorization from the employee. Most employers obey this rule, but it is sometimes violated when the employer classifies its employees as “.” Some companies, typically those who employ delivery drivers, classify their employees as independent contractors. This saves the company lots of money (unemployment taxes, workers compensation, payroll taxes, and other charges). Companies are not allowed to call someone an independent contractor unless he or she is truly
independent and passes the ‘ABC’ test. The employer must not exert control over the way the work is performed. The work must be outside of the normal course of the company’s business and the person must be independently established in a trade profession or occupation.

Delivery drivers are frequently the victims of this practice. They are sometimes required to buy their routes (this violates another Connecticut law) and significant deductions are taken from their pay. Recently, the U.S. District Court for the District of Connecticut ruled that delivery drivers can sue for reimbursement of the fee they paid for their job, the deductions from their pay and the expenses that the employer shifted to them by calling them independent contractors.

Massachusetts and California have specific laws entitling independent contractors to bring these suits. While there is no such law in Connecticut, other laws can be used, including the common law of unjust enrichment.

 

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