97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB1851

 

Introduced 2/9/2011, by Sen. Gary Forby

 

SYNOPSIS AS INTRODUCED:
 
820 ILCS 185/5
820 ILCS 185/10

    Amends the Employee Classification Act. Provides that the term "employment" does not include services performed by an individual as an operator of a truck, truck-tractor, or tractor if certain specified conditions are met. Provides that an individual performing services for a contractor is deemed to be an employee of the employer, unless the contractor is a truck owner-operator as defined in the Act.


LRB097 05258 AEK 45310 b

 

 

A BILL FOR

 

SB1851LRB097 05258 AEK 45310 b

1    AN ACT concerning employment.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Employee Classification Act is amended by
5changing Sections 5 and 10 as follows:
 
6    (820 ILCS 185/5)
7    Sec. 5. Definitions. As used in this Act:
8    "Construction" means any constructing, altering,
9reconstructing, repairing, rehabilitating, refinishing,
10refurbishing, remodeling, remediating, renovating, custom
11fabricating, maintenance, landscaping, improving, wrecking,
12painting, decorating, demolishing, and adding to or
13subtracting from any building, structure, highway, roadway,
14street, bridge, alley, sewer, ditch, sewage disposal plant,
15water works, parking facility, railroad, excavation or other
16structure, project, development, real property or improvement,
17or to do any part thereof, whether or not the performance of
18the work herein described involves the addition to, or
19fabrication into, any structure, project, development, real
20property or improvement herein described of any material or
21article of merchandise. Construction shall also include moving
22construction related materials on the job site to or from the
23job site.

 

 

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1    "Contractor" means any sole proprietor, partnership, firm,
2corporation, limited liability company, association or other
3legal entity permitted by law to do business within the State
4of Illinois who engages in construction as defined in this Act.
5    "Contractor" includes a general contractor and a
6subcontractor.
7    "Department" means the Department of Labor.
8    "Director" means the Director of the Department of Labor.
9    "Employer" means any contractor that employs individuals
10deemed employees under Section 10 of this Act; however,
11"employer" does not include (i) the State of Illinois or its
12officers, agencies, or political subdivisions or (ii) the
13federal government.
14    "Entity" means any contractor for which an individual is
15performing services and is not classified as an employee under
16Section 10 of this Act; however, "entity" does not include (i)
17the State of Illinois or its officers, agencies, or political
18subdivisions or (ii) the federal government.
19    "Interested party" means a person with an interest in
20compliance with this Act.
21    "Performing services" means the performance of any
22constructing, altering, reconstructing, repairing,
23rehabilitating, refinishing, refurbishing, remodeling,
24remediating, renovating, custom fabricating, maintenance,
25landscaping, improving, wrecking, painting, decorating,
26demolishing, and adding to or subtracting from any building,

 

 

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1structure, highway, roadway, street, bridge, alley, sewer,
2ditch, sewage disposal plant, water works, parking facility,
3railroad, excavation or other structure, project, development,
4real property or improvement, or to do any part thereof,
5whether or not the performance of the work herein described
6involves the addition to, or fabrication into, any structure,
7project, development, real property or improvement herein
8described of any material or article of merchandise.
9Construction shall also include moving construction related
10materials on the job site to or from the job site.
11    "Employment" does not include services performed by an
12individual as an operator of a truck, truck-tractor, or
13tractor, if the person or entity to which the individual is
14contracted for service shows that the individual:
15        (1) is either:
16            (i) registered or licensed as a motor carrier of
17        real or personal property by the Illinois Commerce
18        Commission, the Interstate Commerce Commission, or any
19        successor agencies; or
20            (ii) operating the equipment under an
21        owner-operator lease contract with the person or
22        entity, when the person or entity is registered,
23        licensed, or both, as a motor carrier of real or
24        personal property licensed by the Illinois Commerce
25        Commission, the Interstate Commerce Commission, or any
26        successor agencies;

 

 

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1        (2) has the right to terminate the lease contract and
2    thereafter has the right to perform the same or similar
3    services, on whatever basis and whenever he or she chooses,
4    for persons or entities other than the person or entity to
5    which the individual is contracted for services;
6        (3) is not required by the person or entity to which
7    the individual is contracted for services to perform
8    services, or be available to perform services, at specific
9    times or according to a schedule or for a number of hours
10    specified by the person or entity; pickup or delivery times
11    specified by a shipper or receiver shall not be deemed
12    specified by the person or entity;
13        (4) either leases the equipment or holds title to the
14    equipment, if the individual or entity from which the
15    equipment is leased, or which holds any security or other
16    interest in the equipment, is not:
17            (i) the person or entity to which the individual is
18        contracted for service; or
19            (ii) owned, controlled, or operated by or in common
20        with, to any extent, whether directly or indirectly,
21        the person or entity to which the individual is
22        contracted for services or a family member of a
23        shareholder, owner, or partner of the person or entity;
24        (5) pays all costs of licensing and operating the
25    equipment (except when federal or State law or regulation
26    requires the carrier to pay), and the costs are not

 

 

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1    separately reimbursed by any other individual or entity;
2    and
3        (6) maintains a separate business identity, offering
4    or advertising his or her services to the public, by
5    displaying its name and address on the equipment or
6    otherwise.
7    The definition of "truck owner-operator" under this
8Section does not apply:
9        (1) if, as a condition for retaining the individual's
10    services, the person or entity to which the individual is
11    contracted specifies the person or entity from which the
12    equipment is to be leased or purchased; or
13        (2) to any services that are required to be covered as
14    a condition of approval of this Act by the United States
15    Secretary of Labor under Section 3304(a)(6)(A) of the
16    Federal Unemployment Tax Act.
17    Nothing in this definition of "truck owner-operator" shall
18be construed or used to effect the existence or non-existence
19of an employment relationship other than for purposes of this
20Act. For purposes of this definition of "truck owner-operator":
21        (1) "Family member" means any parent, sibling, child,
22    sibling of a parent, or any of the foregoing relations by
23    marriage.
24        (2) "Ownership", "control", or "operation" may be
25    through any one or more natural persons or proxies, powers
26    of attorney, nominees, proprietorships, partnerships,

 

 

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1    associations, corporations, trusts, joint stock companies,
2    or other entities or devices, or any combination thereof.
3        (3) "Persons or entity" means a sole proprietorship,
4    partnership, association, corporation, or any other legal
5    entity.
6(Source: P.A. 95-26, eff. 1-1-08.)
 
7    (820 ILCS 185/10)
8    Sec. 10. Applicability; status of individuals performing
9service.
10    (a) For the purposes of this Act, an individual performing
11services for a contractor is deemed to be an employee of the
12employer except as provided in subsections (b), and (c), and
13(d) of this Section.
14    (b) An individual performing services for a contractor is
15deemed to be an employee of the contractor unless it is shown
16that:
17        (1) the individual has been and will continue to be
18    free from control or direction over the performance of the
19    service for the contractor, both under the individual's
20    contract of service and in fact;
21        (2) the service performed by the individual is outside
22    the usual course of services performed by the contractor;
23    and
24        (3) the individual is engaged in an independently
25    established trade, occupation, profession or business; or

 

 

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1        (4) the individual is deemed a legitimate sole
2    proprietor or partnership under subsection (c) of this
3    Section.
4    (c) The sole proprietor or partnership performing services
5for a contractor as a subcontractor is deemed legitimate if it
6is shown that:
7        (1) the sole proprietor or partnership is performing
8    the service free from the direction or control over the
9    means and manner of providing the service, subject only to
10    the right of the contractor for whom the service is
11    provided to specify the desired result;
12        (2) the sole proprietor or partnership is not subject
13    to cancellation or destruction upon severance of the
14    relationship with the contractor;
15        (3) the sole proprietor or partnership has a
16    substantial investment of capital in the sole
17    proprietorship or partnership beyond ordinary tools and
18    equipment and a personal vehicle;
19        (4) the sole proprietor or partnership owns the capital
20    goods and gains the profits and bears the losses of the
21    sole proprietorship or partnership;
22        (5) the sole proprietor or partnership makes its
23    services available to the general public or the business
24    community on a continuing basis;
25        (6) the sole proprietor or partnership includes
26    services rendered on a Federal Income Tax Schedule as an

 

 

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1    independent business or profession;
2        (7) the sole proprietor or partnership performs
3    services for the contractor under the sole
4    proprietorship's or partnership's name;
5        (8) when the services being provided require a license
6    or permit, the sole proprietor or partnership obtains and
7    pays for the license or permit in the sole proprietorship's
8    or partnership's name;
9        (9) the sole proprietor or partnership furnishes the
10    tools and equipment necessary to provide the service;
11        (10) if necessary, the sole proprietor or partnership
12    hires its own employees without contractor approval, pays
13    the employees without reimbursement from the contractor
14    and reports the employees' income to the Internal Revenue
15    Service;
16        (11) the contractor does not represent the sole
17    proprietorship or partnership as an employee of the
18    contractor to its customers; and
19        (12) the sole proprietor or partnership has the right
20    to perform similar services for others on whatever basis
21    and whenever it chooses.
22    (d) Where a sole proprietor or partnership performing
23services for a contractor as a subcontractor is deemed not
24legitimate under subsection (c) of this Section, the sole
25proprietorship or partnership shall be deemed an individual for
26purposes of this Act. An individual performing services for a

 

 

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1contractor is deemed to be an employee of the employer, unless
2the contractor is a truck owner-operator as defined in Section
35 of this Act.
4    (e) Subcontractors or lower tiered contractors are subject
5to all provisions of this Act.
6    (f) A contractor shall not be liable under this Act for any
7subcontractor's failure to properly classify persons
8performing services as employees, nor shall a subcontractor be
9liable for any lower tiered subcontractor's failure to properly
10classify persons performing services as employees.
11(Source: P.A. 95-26, eff. 1-1-08.)