Originally Posted by GreenIndustryAssociates
A warning about paying under the table. Yes you are opening up a chance for sever penalties. Here are two different things that have happened up here to guys I know, which put both companies out of business.
1) a mediam sized company was paying a couple of extra laborers under the table. There was a freak accident and one of the guys lost a portion of his foot. He went to the hostpital, when doing his paperwork the administrator asked if the injury was work related. He naturally said yes, as it was. After the hospital contacted the employer for their Workers comp info, they found he was not covered. The hospital then billed the employees personal health insurance and notified them that their policy holder was injured while working for a company. The insurance carrier then went after the landscaper for reimbursement, which included over a weeks stay in the hospital and multiple plastic surgeries, and eventually a prosthetic foot. The insurance company also notified the state. The company was investigated by OSHA, Dept of Labor, State Dept of Revenue, and IRS. They quickly went out of business with all of the fines and back taxes they had to pay, as well as the medical bills (which GL won't cover).
2) Another company had some guys working off the books. When it was time to let one of the guys go come winter the employee attempted to file for unemployment. Needless to say the unemployment office had no record of him working the last 8 months or so. He explained that while the employer paid him in cash, he was under the assumption that the employer was holding taxes and just handing him cash instead of cutting an actual paper check. He got his unemployment and the owner was fined heavily, but is still in business. The employee did end up getting a big tax bill at the end of the year though.
So see, paying under the table is a great idea!
If you think for a minute an employee would never what to turn you in after being fired or injured you have a lot to learn. This day and age people are looking for the cash cow.
I too know someone that was paying under the table and an employee was injured...cost him almost 30k out of pocket to pay to put a finger that was nearly cut off back on.
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