October 25, 2012
Voluntary Today, Involuntary Tomorrow
Another Successful Flush by Wackenhut G4S
Will the last Ronco Consulting Corporation Employee out please close the lid ?
Posted by defensebaseactcomp on October 25, 2012
October 25, 2012
Voluntary Today, Involuntary Tomorrow
Another Successful Flush by Wackenhut G4S
Will the last Ronco Consulting Corporation Employee out please close the lid ?
Posted in Afghanistan, Armorgroup, Civilian Contractors, Exclusive Remedy, Follow the Money, G4S, Iraq, Ronco Consulting, State Department, Taxes, Wackenut | Tagged: Armorgroup, Demining, G4S, injured war zone contractors, Landmines, Riff, Riffing, Ronco, Ronco Consulting, Ronco Consulting Corporation, State Department, Wackenhut | Leave a Comment »
Posted by defensebaseactcomp on May 23, 2012
Law Offices of Scott J Bloch May 23, 2012
WASHINGTON, DC (May 23, 2012) – Blackwater Industries, which changed its name to Xe Services, and now has changed it yet again to Academi LLC, lost its initial bid to have the $240 million suit for employee misclassification sent to arbitration and dismissed from federal court in Washington, D.C.
Scott Bloch filed an amended complaint (see link above) in the class action lawsuit on behalf of four former security specialists, who were injured while working for Blackwater, in order to recover their payment of social security, unemployment insurance, and unpaid benefits and state and local withholding and unemployment insurance, and other unspecified damages. The action seeks $240,000,000 in damages for lost benefits, overtime, treble damages and punitive damages, as well as additional amounts as proved for the class of specialists.
The court has rejected that motion filed by Blackwater and required it to file another motion to determine if the same Plaintiffs agreed to have an arbitrator determine if the agreements were unconscionable, procured by duress, fraud and undue influence.
“Blackwater acted illegally and unconscionably toward these brave individuals,” said Bloch. ”Through their fraud as pointed out in the Amended Complaint, they avoided overtime for security workers who worked sometimes 12-16 hours a day 6 days a week. They were forced to sign agreements they never read and were not given time to read and not given copies, which took away valuable rights and were unlawful in their terms. Now the court has rejected their initial motion and required Blackwater to seek the same relief if they can prove that the Plaintiffs who never were allowed to read the original agreements agreed to have an arbitrator determine whether they properly agreed to anything. We continue to assert the illegality of the agreements and the actions of Blackwater.”
Posted in Blackwater, Civilian Contractors, Defense Base Act, Defense Base Act Insurance, Follow the Money, Taxes, Xe | Tagged: Academi, Arbitration, Blackwater, Civilian Contractors, DBA Fraud, Defense Base Act Fraud, Illegally obtained documents, Labor Law, Scott Bloch, Tax Fraud, Taxes, Xe | 3 Comments »
Posted by defensebaseactcomp on May 22, 2012
The EEOC granted a former Ronco Consulting Employee and American Injured War Zone Contractor the Right to Sue under the Americans with Disabilities Act after investigating the complaint.
The Americans with Disabilities Act prohibits discrimination against persons with disabilities.
Even those who were disabled due to the negligence of the company in question.
Posted in AIG and CNA, Civilian Contractors, Defense Base Act, Defense Base Act Insurance, Department of Labor, Injured Contractors, Misjudgements, Ronco Consultilng, Ronco Consulting, Taxes | Tagged: ADA, Americans with Disability Act, Civilian Contractors, Contractor Casualties, Defense Base Act Class Action Lawsuit, EEOC, Equal Employment Opportunity Commission, injured war zone contractors, Ronco, Ronco ADA, Ronco Consulting, Ronco Consulting Corporation, Ronco EEOC, Ronco Lawsuit, Scott Bloch, Scott J Bloch | Leave a Comment »
Posted by defensebaseactcomp on June 7, 2011
Scott Bloch blasts Blackwater on behalf of thousands of former employees who were mistreated and denied employee benefits, unemployment and other withholding based on a fraudulent misclassification as independent contractors.
Statement Concerning Filing of Class Action Tax Misclassification Against Xe Services (formerly Blackwater) on
Behalf of Personal Security Specialists for Loss of Benefits and Withholding
WASHINGTON, DC (June 7, 2011) –
Since 2007, Blackwater Industries, which has changed its name to Xe Services, has employed over 10,000 personal security specialists to perform operations in Iraq and Afghanistan under lucrative contracts with departments of the United States Government including the State Department and CIA.
While employing these individuals, many of whom are decorated veterans of the armed services including Special Forces, Army Rangers, Navy Seals, Blackwater sought to avoid millions of dollars in taxes, withholding, and payments of benefits to these employees by classifying them improperly as independent contractors.
Yesterday, Scott Bloch filed a class action lawsuit on behalf of four former security specialists, who were injured while working for Blackwater, in order to recover their payment of social security, unemployment insurance, and unpaid benefits and state and local withholding and unemployment insurance, and other unspecified damages. The action is brought on their own behalf and thousands of others who have worked for Blackwater and its newly named Xe Services.
The action seeks $60,000,000 in damages and punitive damages, as well as additional amounts as proved for the class of specialists.
“These brave individuals who worked in support of Operation Iraqi Freedom and Afghani Enduring Freedom, deserve better than to be turned away without health insurance, pension benefits, unemployment benefits, and other withholding afforded to Blackwater’s other
employees,” said Scott Bloch.
According to the lawsuit, the United States treasury loses billions of dollars annually to misclassified employees. Under the commonlaw and the IRS 20 questions put out in 1987 pursuant to a regulation, Blackwater was obliged to classify these individuals as employees if Blackwater had the right to control the employees’ actions, manner of performing duties, hours, training, equipment, whether the duties of the employees go to a core function of the employer or are duties that are consider ancillary to the main purpose of the company, and other factors.
The lawsuit states that Blackwater provided their equipment, including weapons issued by the government, training, and control over employees’ duties, manner of performing their security duties, operations they went on, protection details and other duties.
“These veterans were actually given diplomatic passports and classified as employees of Blackwater to the United States government in the contracts as they procured insurance required for employees, and also represented to the State Department that they were
employees,” said Bloch in a statement upon filing, “yet when it came to paying taxes, paying their employer portion of social security and Medicare taxes that all Americans expect their employers to pay, they simply claimed they were independent contractors.”
The suit also states that one of the representative plaintiffs already had a determination from the IRS that Blackwater misclassified him as an independent contractor. “The IRS already determined in the case of one of my clients that he should have been classified as an
employee,“ said Bloch. “Now thousands of people will have to file amended returns. Thousands of people will likely be entitled to benefits they were denied due to the misclassification, including payment of their employer share of pension, health and disability
insurance premiums, and other plans that Blackwater filed with the government for its employees, promising it would not discriminate against those employees as they did here.”
In addition, claims the suit, the United States Congress previously held hearings under the Oversight and Government Reform committee, Rep. Henry Waxman, Chair, which determined that Blackwater and its related companies misclassified employees in order to avoid millions of dollars in taxes. In addition, the IRS prior to making the determination on the plaintiff in this suit, had ruled on behalf of other Blackwater security specialists, and related job titles, that Blackwater had misclassified these employees who performed services under contracts in Iraq and Afghanistan.
“Blackwater made hundreds of millions of dollars from taxpayers and hired thousands of former veterans of military service and police officers. They also had in their ranks Federal Agents, such as current employees of the FBI on leave of absence. They were hired as security specialists in Iraq and Afghanistan,” said Bloch. “It is a grave injustice to them who were mistreated and left without any health insurance or other benefits for their families, and left to fend for themselves in paying into Social Security and Medicare. They laid down their lives to protect dignitaries and carry out duties in support of wars for America, and they deserve better than this. Many of these same men risked their lives to protect everyone from the President of the United States to U.S. Senators, Congressman, U.S. Diplomats, to Foreign Presidential & Diplomatic Figures in one of the most dangerous places on the planet.”
The case was filed in the United States District Court for the District of Columbia and covers individuals from all over the United States and some Americans living abroad, including all former and current Blackwater and Xe employees and so-called independent contractors.
Contact Scott J. Bloch, PA:
Scott Bloch, 202-496-1290
Posted in Blackwater, Civilian Contractors, Defense Base Act, Political Watch, State Department, Taxes, Xe | Tagged: Blackwater, Civilian Contractors, Consultant, DBA Insurance, Defense Base Act, ERISA, Fraud, Independent Contractor, Tax Misclassification, Xe | 13 Comments »
Posted by defensebaseactcomp on February 24, 2011
Some Contract Companies avoid paying Medicare and Social Security Taxes on their employees by classifying them as independent contractors or consultants. The IRS considers this to be Fraud.
These same companies claim these same independent contractors/consultants to be employee’s for the purposes of acquiring mandated Defense Base Act Worker’s Compensation Insurance. Even going so far as to have workers sign and back date employee contracts after they have been injured so they will be covered.
See more on Misclassification of Employee’s as Contractors at Overseas Contractors Tax Information where you will also find a link to the IRS Form SS-8
Following is a recent SS-8 Determination which confirms the Misclassification and opens up the company to an investigation of Tax and Insurance Fraud and US Labor Law Violations.
Posted in Blackwater, Civilian Contractors, KBR, Taxes | Tagged: Blackwater, Civilian Contractors, DBA Insurance Fraud, IRS SS-8, Labor Law Violations, Misclassification of Employees, Tax Fraud, Taxes | 3 Comments »
Posted by defensebaseactcomp on February 1, 2011
The Tax Court yesterday held that a Florida man who earned $98,400 in 2005 working for Blackwater (since renamed Xe) providing security services to the U.S. Army in Iraq could not exclude the compensation from income under § 112 as “combat zone compensation of members of the Armed Forces.
” Holmes v. Commissioner, T.C. Memo. 2011-26 (Jan. 31, 2011).
The Tax Court concluded that the taxpayer did not serve in the Armed Forces of the United States but instead was a private citizen hired by and paid by a private company (Blackwater). The Tax Court refused to impose a penalty because the taxpayer relied on an IRS memorandum wrongly stating that civilian personnel in direct support of combat zone military operations qualified for the § 112 exclusion. (Hat Tip: Bob Kamman.) Please see the original here
Posted in Blackwater, Civilian Contractors, Taxes | Tagged: 112, Blackwater, Civilian Contractor, Combat Zone Compensation, Private Military Contractors, Private Security Contractors, Taxes, Xe | Leave a Comment »
Posted by defensebaseactcomp on February 17, 2010
KBR, Blackwater, CSA, MPRI, Ronco Consulting and possibly the company you work, worked for have misrepresented their employees as Independent Contractors in order to keep from paying Social Security and Medicare Taxes. As an American citizen you are responsible for paying these whether the company you work for is offshore or not. That is not to say all these companies were offshore that did this.
Now these same companies while happily not accepting the responsibilities of employing you for tax purposes were happy to lie and claim you were an employee when they got the DBA insurance they were supposed to get in order to be eligible to take that government contract.
What might happen that is while your injured, not working and financially getting screwed over by the DBA insurance company AIG or CNA the IRS might come asking you about those taxes you didn’t pay while you were working overseas tax free but still must pay medicare and SS, which would have cost you 15,000 but with the part the company didn’t pay and the fines and late fees they force you to come up with $60,000. Try not to bleed on it.
For more on how to determine if you were an employee or not go here MisClassifying Employees as Independent Contractors
But trust that if the company paid your air fare, told you where and when to go to work and how to do it using their vehicles and equipment, you were an employee according to the IRS.
Federal and state officials, many facing record budget deficits, are starting to aggressively pursue companies that try to pass off regular employees as independent contractors.
President Obama’s 2010 budget assumes that the federal crackdown will yield at least $7 billion over 10 years. More than two dozen states also have stepped up enforcement, often by enacting stricter penalties for misclassifying workers.
Many workplace experts say a growing number of companies have maneuvered to cut costs by wrongly classifying regular employees as independent contractors, though they often are given desks, phone lines and assignments just like regular employees. Moreover, the experts say, workers have become more reluctant to challenge such practices, given the tough job market.
Companies that pass off employees as independent contractors avoid paying Social Security, Medicare and unemployment insurance taxes for those workers. Companies do not withhold income taxes from contractors’ paychecks, and several studies have indicated that, on average, misclassified independent workers do not report 30 percent of their income.
One federal study concluded that employers illegally passed off 3.4 million regular workers as contractors, while the Labor Department estimates that up to 30 percent of companies misclassify employees. Ohio’s attorney general estimates that his state has 92,500 misclassified workers, which has cost the state up to $35 million a year in unemployment insurance taxes, up to $103 million in workers’ compensation premiums and up to $223 million in income tax revenue.
“It’s a very significant problem,” said the attorney general, Richard Cordray. “Misclassification is bad for business, government and labor. Law-abiding businesses are in many ways the biggest fans of increased enforcement. Misclassifying can mean a 20 or 30 percent cost difference per worker.”
Employers deny misclassifying workers deliberately. The businesses say the lines are unclear between employee and independent contractor.
Workers are generally considered employees when someone else controls how and when they perform their work. In contrast, independent contractors are generally in business for themselves, obtain customers on their own and control how they perform services.
Many businesses are dismayed about the tougher federal and state scrutiny.
“The goal of raising money is not a proper rationale for reclassifying who falls on what side of the line,” said Randel K. Johnson, senior vice president with the United States Chamber of Commerce. “The laws are unclear in this area, and legitimate clarification is one thing. But if it’s just a way to justify enforcing very unclear laws against employers who can have a legitimate disagreement with the Labor Department or I.R.S., then we’re concerned.”
Among the most often misclassified workers are truck drivers, construction workers, home health aides and high-tech engineers.
Portraying regular workers as contractors allows companies to circumvent minimum wage, overtime and antidiscrimination laws. Workers classified as contractors do not receive unemployment insurance if laid off or workers’ compensation if injured, and they rarely receive the health insurance or other fringe benefits regular employees do.
“This denies many workers their basic rights and protections and means less revenues to the Treasury and a competitive advantage for employers who misclassify,” said Jared Bernstein, who as executive director of Vice President Joseph A. Biden’s Middle Class Task Force has helped orchestrate the administration’s campaign against misclassification. “The last thing you want is to give a competitive advantage to employers who are breaking the rules.”
Organized labor, a strong supporter of Mr. Obama, has long complained about the practice. No administration has undertaken as big a crackdown as Mr. Obama’s, although administration and state officials deny they are doing it as a favor to labor.
California’s attorney general, Jerry Brown, is seeking $4.3 million from a construction firm he accused of misclassifying employees. Last April, he won a $13 million judgment when a court ruled that two companies had misclassified 300 janitors, cheated the state out of payroll taxes and not paid minimum wage and overtime.
Last November, the Illinois Department of Labor imposed $328,500 in penalties on a home improvement company for misclassifying 18 workers, saying it had pressed them to incorporate as separate business entities.
The Obama administration plans to expand investigations by hiring 100 more enforcement personnel. The I.R.S. has begun auditing 6,000 companies to see whether they are in compliance with the law.
Posted by defensebaseactcomp on February 1, 2010
Following are answers to our most commonly asked tax questions.
If you received monthly payments from the DBA insurance company they are not taxable. This is no great gift, it is part of why your benefits are only figured on two thirds of your Average Weekly Wage.
If you were covered under DBA insurance in 2009 you were an employee of the company you worked for unless they misrepresented you as an employee in order to qualify for the insurance.
If your company misrepresented you as an independent contractor for tax purposes you will need to file
Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding Form SS-8
The limit on excludable income for 2009 is $91,400.00
Social Security and has a limit of $102,000 for 2008 $110,100 for 2012
See Publication 15
All covered Wages are subject Medicare Taxes
Please add any helpful experience you’ve had here.