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Louisiana Offers Employers a Chance to Correct Independent Contractor Misclassifications

As of January 1, 2023, Louisiana employers that have been misclassifying workers as independent contractors may apply to the Louisiana Fresh Start Proper Worker Classification Initiative (the “Program”). The Program allows employers who have been misclassifying workers as independent contractors to reclassify those workers and voluntarily disclose the reclassification to the Louisiana Department of Revenue (LA DOR) without liability for prior periods.

The LA DOR will review the application to verify eligibility and notify the business, in writing, of its determination. Upon receipt of this notice, the taxpayer shall treat the class or classes of workers subject to the application as employees beginning on the reclassified date stated in the closing agreement.

Next Steps for Employers

Employers should review their worker classification to determine whether any groups of individuals treated as non-employees should have been classified as such. After making this determination, employers may wish to seek guidance from their legal counsel whether to file an application with the Program to correct any misclassifications.

Multistate employers should keep in mind that other states may have specific tests to establish independent contractor status which may have more stringent requirements than those under federal or Louisiana law.

Employers who wish to participate in this Program should pay close attention to the Program dates. Qualifying employers must submit an application for the Fresh Start Program to the Department between January 1, 2023, and December 31, 2023. The application can be found on the Department’s website and must be submitted by email to FreshStart.LDR@LA.GOV.

HR Works, headquartered in Upstate New York, is a human resource management outsourcing and consulting firm serving clients throughout the United States for over thirty years. HR Works provides scalable strategic human resource management and consulting services, including: affirmative action programs; benefits administration outsourcing; HRIS self-service technology; full-time, part-time and interim on-site HR managers; HR audits; legally reviewed employee handbooks and supervisor manuals; talent management and recruiting services; and training of managers and HR professionals.