Company Fined for Misclassifying Workers, Underpaying Them by €1.5M
A company in the Cham district has been convicted for misclassifying employees as self-employed and underpaying them, resulting in significant savings on social security administration contributions.
Between 2016 and 2021, the company distributed and installed metal systems, employing three installers as alleged self-employed persons. However, the Main Customs Office Regensburg's Financial Control Black Work unit found that these workers were actually employees, not self-employed.
The company's owner was charged with withholding and misappropriation of wages by the Regensburg Public Prosecutor's Office. By not reporting the workers' wages, the company saved around 165,000 euros in social security administration, totaling almost 1.5 million euros in savings.
The Regensburg Local Court sentenced the company owner to a total fine of 51,150 euros. He was also ordered to pay the withheld social security administration and court costs. This conviction serves as a reminder of the importance of proper employee classification and wage payment.
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