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Seamstresses exempted from unemployment insurance law

June 04, 2009|By ERIN CUNNINGHAM

HAGERSTOWN -- The owner of a Hagerstown business said she almost had to close her doors when she learned a state department was requiring her to pay an additional $100,000 annually in business costs.

However, Alice Backman, who owns Alice's Home & Cottage on McCauley Court, said she wasn't giving up her 27-year-old business without a fight. She worked with state lawmakers on legislation that passed the Maryland General Assembly this year, exempting businesses from paying unemployment insurance for seamstresses who work in their own homes.

A similar bill, introduced by Del. LeRoy E. Myers Jr., Allegany/Washington, during the 2008 legislative session, did not pass.

Alice's Cottage is a manufacturer of fabric, home textiles and gifts. Backman said she also manufactures historic clothing for sites like Colonial Williamsburg in Virginia.

Backman employs 10 full-time workers, but has contracts with as many as 60 seamstresses, depending on the season. The seamstresses are independent, self-employed contractors.

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Seamstresses previously were not included in a bill that exempts barbers who rent a chair in a shop and other types of workers from unemployment insurance requirements.

In 2006, the Maryland Department of Labor, Licensing and Regulation (DLLR) contacted Backman saying the seamstresses were actually her employees -- holding Backman liable for unemployment insurance and other fees.

Backman said an attorney said that could cost her as much as $100,000 annually.

At that time, she contacted Myers, who Backman said "really championed my cause."

Myers introduced legislation in 2008 that would have excluded seamstresses from the DLLR insurance requirements. That bill failed, but DLLR supported a similar bill this year that passed.

"Here was the state of Maryland trying to say that these people worked directly for (Alice's Cottage), which they don't," Myers said.

Backman said the seamstresses are paid by the pieces they sew. They work when they want, on what they want, and sew in their homes, she said.

"Seamstresses can now sew in their homes and not have to worry anymore," Backman said. "There was always a gray area there, but now they can earn a living using their skill ... as independent, self-employed contract workers."

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