Construction firms in Chicago are increasingly using immigrant labor designated as "independent subcontractors", enabling them to bid lower than other firms to win construction jobs. The designation means firms can bypass paying unemployment insurance, workers compensation and payroll taxes, in addition to paying workers $15 to $20 less than the union-negotiated hourly rate. Officials estimate the practice cost the state $350 million in tax income in 2005 alone.
See "Freelance labor costs state $300 million", Bob Tita, Chicago Business, June 3, 2007