This regular feature shows how other companies have run afoul of IRS regulations, sales and use taxes or other laws. You can see how others got off track, and avoid similar problems. Today’s problem: misclassifying workers.

• Business: Aspen Power, LLC, Lufkin, TX.
• Violation: Classifying 135 workers as independent contractors (ICs) instead of as employees.
• Penalty: DOL forced the company to properly classify the workers and pay $485,107 in overtime back wages.

Note: Aspen claimed the workers in question were ICs because they were free to perform work for other companies. However, many of the employees worked 12-hour days, seven days per week – so the time they could commit to other companies was substantially limited.