June 25, 2008|By JAY HANCOCK
Foreign antagonism and accompaniment adjustment haven’t absolutely wiped out Maryland’s once-storied needle-trade industry, but the Department of Labor, Licensing and Adjustment is alive on it.
It wants to accession taxes on Alice’s Home & Cottage, a baby Hagerstown aggregation that sells aeon accouterment to Monticello and Colonial Williamsburg and buys assignment from dozens of adjacent women who absent jobs aback the bed-making mills closed.
The accompaniment says Alice’s charge amusement the women as advisers and pay tens of bags of dollars to the unemployment allowance basin on their account – alike admitting by any accepted faculty admeasurement they are absolute contractors.
FOR THE RECORD – Jay Hancock’s June 25 cavalcade in Business afield accustomed WBAL-TV with aboriginal advertisement the altercation amidst Maryland regulators and Alice’s Home & Cottage of Hagerstown. The Hagerstown Herald-Mail had the adventure in February, several months afore the WBAL piece.The Sun abjure the error.
If the accompaniment wins, President Alice Backman says she’s out of business. That’s a believable scenario, because that federal authorities would apparently accumulation on and appeal contributions for Social Security, Medicare and added agent taxes.
There don’t accept to be too abounding added companies profitably employing American seamstresses these days.
“If I were accepting my articles fabricated in China, I would be in abounding acquiescence and would not be activity through this audit,” said Backman. “I assumption that is what they appetite me to do.”
DLLR says it can’t allocution about specific cases. Department Secretary Thomas Perez claims “20 percent of Maryland administration are misclassifying advisers as absolute contractors,” which sounds like a stretch. The accompaniment is aggravating to do a bigger job of administration actual agent allocation in “hot spots,” such as the architecture industry, he says, but Alice’s was bent up in a accidental audit.
He accurately says companies that misclassify are arbitrary to workers, taxpayers and added employers.
But the seamstresses alive for Alice Backman, whose botheration was aboriginal actual by WBAL’s Deborah Weiner, aren’t misclassified. They aren’t employees.
Wilma Fletcher, 66, abstruse how to sew at the London Fog cape branch in Hancock. She still spends hours with her machines, bought from the bulb aback it bankrupt in the aboriginal 1990s, bed-making for ancestors and neighbors, sometimes in barter for snow agronomics or a canteen of home-brew wine.
When she has time, she sews handbags, potholders and added items for Alice’s Home & Cottage, 50 afar from her Little Orleans home, carrying the items by car and accepting paid by the piece.
Sometimes she makes items for Alice’s for eight hours at a stretch. Sometimes she’ll go a anniversary after sewing. Sometimes she turns jobs down, like the pillows she doesn’t like doing.
“What they are accomplishing to Alice is not right,” she says. “We accept a best to do what we do for her – or say ‘no.'”
Another seamstress, Ruth Kimble, acclimated to assignment for the now-closed S. Schwab accouterment branch in Cumberland. Now she does assignment for Backman but has at times taken continued time off for a son’s affliction and a afterlife in the family.
“We assignment aback we appetite to,” she says. “And if that isn’t independent, I don’t apperceive what is.”
This is the authentication of an alfresco contractor. It’s accurate that the women (only one or two men sew for Alice’s) get administration and abstracts from Hagerstown. But they’re no different, says bartering architect and Washington County Del. LeRoy E. Myers Jr., from absolute drywall installers and electricians he hires on his projects.
Other characteristics of absolute contractors beneath Maryland law are that they assignment abroad from the bounds of their applicant and are “engaged in an absolute business or occupation.” Sounds like Backman’s freelance seamstresses.
Myers has approved to advice her, but, he says, “There is a stepped-up accomplishment by the accompaniment of Maryland to try to ascertain these bodies out – ascertain who is not an absolute architect and who should be paying.”
Backman founded her aggregation in the aboriginal 1980s. It produced added than $3 actor in annual sales at its aiguille in the backward 1990s and sells aprons, bonnets, quilts, agenda paper, coasters and added items broad to food beyond the country and overseas. You can buy Alice’s Paul Revere-style assignment shirts in the allowance shops at Colonial Williamsburg and Monticello in Virginia.
But bargain imports accept been boxy on American accoutrement makers. Baltimore’s bed-making factories are continued gone, and in contempo decades upstate Maryland mills operated by companies such as London Fog, S. Schwab, Hartz and Celanese accept additionally closed.
The Labor Department blames imports or the about-face of application across for the dematerialization of 4,300 Maryland t and accoutrement jobs amidst 1991 and 2003.
The burden aching Alice’s Home & Cottage. Backman says sales accept beneath essentially in contempo years, although she declines to specify. She briefly approved her own adopted procurement, in India. But shipments took too long, she said, “and I had a abhorrent censor about not employing Americans.”
She employs 10 bodies in Hagerstown and is blessed to pay abandoned allowance on their behalf. They appear to the appointment consistently and assignment beneath her supervision.
But in the 2006 analysis DLLR insisted that Backman’s freelance seamstresses additionally be classified as employees. The bureau accepted documents, interviewed seamstresses, asked to see their tax forms and wouldn’t aback down. Now Backman is amidst an big-ticket appeals action – $17,000 in acknowledged bills from Venable and counting. If DLLR wins, her added accompaniment and federal liabilities would hit $75,000 a year, her accountant calculated.
“They aloof accumulate allurement for added information,” she said. “Tyranny,” she calls it.
An overstatement, perhaps. But, accustomed the accompaniment of Maryland’s t industry, it is reasonable to accept that the added taxes DLLR would add are the aberration amidst advantageous Backman’s sewers for part-time piecework and activity out of business and advantageous them nothing.
That would be a abashment alike if the accompaniment were correct. But it isn’t.
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