Townsend, Errigo, Miller J, Calhoun, McDonough, Giglio
MLTSPNSR
Crouch
Amd SS170, 171-h, 611 & 697, Tax L; rpld & add S2 sub 4 & S201 sub 5, Work Comp L; amd SS2, 190, 511 & 671,
rpld & add S651 sub 5, Lab L
Amends the definition of "employee" to grant the department of taxation and finance the authority to determine the scope thereof and whether any such person may be an independent contractor; provides that undocumented workers residing in the state shall be subject to resident personal income taxation.
STATE OF NEW YORK
________________________________________________________________________
6793
2009-2010 Regular Sessions
IN ASSEMBLY
March 12, 2009
___________
Introduced by M. of A. BALL, TOWNSEND, ERRIGO, MILLER, CALHOUN, McDO-
NOUGH, GIGLIO -- Multi-Sponsored by -- M. of A. CROUCH, QUINN -- read
once and referred to the Committee on Labor
AN ACT to amend the tax law, the workers' compensation law and the labor
law, in relation to classifications of employees; and to repeal
certain provisions of the workers' compensation law and the labor law
relating thereto
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 170 of the tax law is amended by adding a new
2 subdivision 9 to read as follows:
3 9. The department shall promulgate and regularly update rules and
4 regulations defining and establishing a procedure for determining wheth-
5 er a person is an employee.
6 (a) Employee shall not include any person performing a service if:
7 (i) the person is free from control and direction in connection with
8 the performance of the service, both under his or her contract for the
9 performance of service and in fact;
10 (ii) the service is performed outside the usual course of the business
11 of an employer; and
12 (iii) the person is customarily engaged in an independently estab-
13 lished trade, occupation, profession or business of the same nature as
14 that involved in the service performed.
15 (b) The failure to withhold federal or state income taxes, or to pay
16 unemployment compensation contributions or workers' compensation premi-
17 ums with respect to a person's wages shall be considered in making a
18 determination pursuant to this subdivision.
19 (c) A person's exercise of the option to secure workers' compensation
20 insurance with a carrier as a sole proprietor or partnership shall not
21 be considered in making a determination pursuant to this subdivision.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10108-02-9
A. 6793 2
1 § 2. Paragraphs (a) and (b) of subdivision 2 of section 171-h of the
2 tax law, as amended by chapter 398 of the laws of 1997, are amended to
3 read as follows:
4 (a) (i) "employee" means an individual who is an employee [within the
5 meaning of chapter twenty-four of the internal revenue code of 1986] as
6 determined by the department, and does not include:
7 (A) an employee of a federal or state agency performing intelligence
8 or counterintelligence functions if the head of such agency has deter-
9 mined that a report made pursuant to this section with respect to the
10 individual could endanger the safety of the employee or compromise an
11 ongoing investigation or intelligence mission; or
12 (B)(I) any individual who is free from control and direction in
13 connection with the performance of a service, both under his or her
14 contract for the performance of service or in fact;
15 (II) the service is performed outside of the usual course of business
16 of the employer; and
17 (III) the individual is customarily engaged in an independently estab-
18 lished trade, occupation, profession or business of the same nature as
19 that involved in the service performed;
20 (ii) the failure to withhold federal or state income taxes, or to pay
21 unemployment compensation contributions or workers' compensation premi-
22 ums with respect to an individual's wages shall not be considered in
23 making a determination pursuant to this paragraph.
24 (iii) an individual's exercise of the option to secure workers'
25 compensation insurance with a carrier as a sole proprietor or partner-
26 ship shall not be considered in making a determination pursuant to this
27 paragraph.
28 (b) "employer" means an individual or entity [within the meaning given
29 the term employer in section three thousand four hundred one (d) of the
30 internal revenue code of 1986] engaged in the employment of any employee
31 or employees and includes:
32 (i) any governmental entity, and
33 (ii) any labor organization as defined in section two (5) of the
34 national labor relations act, including any entity (also known as a
35 "hiring hall") which is used by such labor organization and an employer
36 to carry out the requirements described in section eight (f)(3) of the
37 national labor relations act with respect to any agreement that may
38 exist between the labor organization and the employer.
39 § 3. Section 611 of the tax law is amended by adding a new subsection
40 (c) to read as follows:
41 (c) Undocumented worker. A person nor a resident of this state nor a
42 nonresident, and considered an undocumented worker as determined by the
43 department, earning income in this state, shall be taxed as a resident
44 pursuant to the provisions of this article. Should such person fail to
45 comply with the provisions of this article, each employer who paid
46 income to such undocumented worker shall be responsible for complying
47 with the provisions of this article in the place and stead of the undoc-
48 umented worker.
49 § 4. Subsection (e) of section 697 of the tax law is amended by adding
50 a new paragraph 3-b to read as follows:
51 (3-b) Nothing in this subsection shall be construed to prohibit the
52 department, its employees or officers from reviewing the wage payment
53 records and contracts of any person or entity for the purpose of deter-
54 mining the classification of any individual as an employee of such
55 person or employer. All information derived from any such review may be
56 disclosed to the department of labor and the workers' compensation
A. 6793 3
1 board, and their officers and employees in connection with their lawful
2 duties.
3 § 5. Subdivision 4 of section 2 of the workers' compensation law is
4 REPEALED and a new subdivision 4 is added to read as follows:
5 4. "Employee" means a person engaged in employment in one of the occu-
6 pations enumerated in section three of this article or any other employ-
7 ment as determined by the department of taxation and finance.
8 (a) Such term shall not include any person performing a service if:
9 (i) the person is free from control and direction in connection with
10 the performance of the service, both under his or her contract for the
11 performance of service and in fact;
12 (ii) the service is performed outside the usual course of the business
13 of an employer; and
14 (iii) the person is customarily engaged in an independently estab-
15 lished trade, occupation, profession or business of the same nature as
16 that involved in the service performed.
17 (b) The failure to withhold federal or state income taxes, or to pay
18 unemployment compensation contributions or workers' compensation premi-
19 ums with respect to a person's wages shall not be considered in making a
20 determination pursuant to this subdivision.
21 (c) A person's exercise of the option to secure workers' compensation
22 insurance with a carrier as a sole proprietor or partnership shall not
23 be considered in making a determination pursuant to this subdivision.
24 § 6. Subdivision 5 of section 201 of the workers' compensation law is
25 REPEALED and a new subdivision 5 is added to read as follows:
26 5. "Employee" means a person engaged in any employment as determined
27 by the department of taxation and finance.
28 (a) Such term shall not include any person performing a service if:
29 (i) the person is free from control and direction in connection with
30 the performance of the service, both under his or her contract for the
31 performance of service and in fact;
32 (ii) the service is performed outside the usual course of the business
33 of an employer; and
34 (iii) the person is customarily engaged in an independently estab-
35 lished trade, occupation, profession or business of the same nature as
36 that involved in the service performed.
37 (b) The failure to withhold federal or state income taxes, or to pay
38 unemployment compensation contributions or workers' compensation premi-
39 ums with respect to a person's wages shall not be considered in making a
40 determination pursuant to this subdivision.
41 (c) A person's exercise of the option to secure workers' compensation
42 insurance with a carrier as a sole proprietor or partnership shall not
43 be considered in making a determination pursuant to this subdivision.
44 § 7. Subdivision 5 of section 2 of the labor law is amended to read as
45 follows:
46 5. "Employee" means a mechanic, workingman or laborer working for
47 another for hire as determined by the department of taxation and
48 finance.
49 (a) Such term shall not include any person performing a service if:
50 (i) the person is free from control and direction in connection with
51 the performance of the service, both under his or her contract for the
52 performance of service and in fact;
53 (ii) the service is performed outside the usual course of the business
54 of an employer; and
A. 6793 4
1 (iii) the person is customarily engaged in an independently estab-
2 lished trade, occupation, profession or business of the same nature as
3 that involved in the service performed.
4 (b) The failure to withhold federal or state income taxes, or to pay
5 unemployment compensation contributions or workers' compensation premi-
6 ums with respect to a person's wages shall not be considered in making a
7 determination pursuant to this subdivision.
8 (c) A person's exercise of the option to secure workers' compensation
9 insurance with a carrier as a sole proprietor or partnership shall not
10 be considered in making a determination pursuant to this subdivision.
11 § 8. Subdivision 2 of section 190 of the labor law, as added by chap-
12 ter 548 of the laws of 1966, is amended to read as follows:
13 2. "Employee" means any person employed for hire by an employer in any
14 employment as determined by the department of taxation and finance.
15 (a) Such term shall not include any person performing a service if:
16 (i) the person is free from control and direction in connection with
17 the performance of the service, both under his or her contract for the
18 performance of service and in fact;
19 (ii) the service is performed outside the usual course of the business
20 of an employer; and
21 (iii) the person is customarily engaged in an independently estab-
22 lished trade, occupation, profession or business of the same nature as
23 that involved in the service performed.
24 (b) The failure to withhold federal or state income taxes, or to pay
25 unemployment compensation contributions or workers' compensation premi-
26 ums with respect to a person's wages shall not be considered in making a
27 determination pursuant to this subdivision.
28 (c) A person's exercise of the option to secure workers' compensation
29 insurance with a carrier as a sole proprietor or partnership shall not
30 be considered in making a determination pursuant to this subdivision.
31 § 9. Section 511 of the labor law is amended by adding a new subdivi-
32 sion 23 to read as follows:
33 23. (a) Notwithstanding any other provision of this section, employ-
34 ment shall be defined by the department of taxation and finance.
35 Employment shall not include work by any person performing a service if:
36 (i) the person is free from control and direction in connection with
37 the performance of the service, both under his or her contract for the
38 performance of the service and in fact;
39 (ii) the service is performed outside the usual course of the business
40 of an employer; and
41 (iii) the person is customarily engaged in an independently estab-
42 lished trade, occupation, profession or business of the same nature as
43 that involved in the service performed.
44 (b) The failure to withhold federal or state income taxes, or to pay
45 unemployment compensation contributions or workers' compensation premi-
46 ums with respect to a person's wages shall not be considered in making a
47 determination pursuant to this subdivision.
48 (c) A person's exercise of the option to secure workers' compensation
49 insurance with a carrier as a sole proprietor or partnership shall not
50 be considered in making a determination pursuant to this subdivision.
51 § 10. Subdivision 5 of section 651 of the labor law is REPEALED and a
52 new subdivision 5 is added to read as follows:
53 5. "Employee" means a person engaged in any employment as determined
54 by the department of taxation and finance.
55 (a) Such term shall not include any person performing a service if:
A. 6793 5
1 (i) the person is free from control and direction in connection with
2 the performance of the service, both under his or her contract for the
3 performance of service and in fact;
4 (ii) the service is performed outside the usual course of the business
5 of an employer; and
6 (iii) the person is customarily engaged in an independently estab-
7 lished trade, occupation, profession or business of the same nature as
8 that involved in the service performed.
9 (b) The failure to withhold federal or state income taxes or to pay
10 unemployment compensation contributions or workers' compensation premi-
11 ums with respect to a person's wages shall not be considered in making a
12 determination pursuant to this subdivision.
13 (c) A person's exercise of the option to secure workers' compensation
14 insurance with a carrier as a sole proprietor or partnership shall not
15 be considered in making a determination pursuant to this subdivision.
16 § 11. Subdivision 2 of section 671 of the labor law, as added by chap-
17 ter 552 of the laws of 1969, is amended to read as follows:
18 2. (a) "Employee" includes any individual employed or permitted to
19 work by an employer on a farm as determined by the commissioner of taxa-
20 tion and finance but shall not include: [(a)] (i) domestic service in
21 the home of the employer; [(b)] (ii) the parent, spouse, child or other
22 member of the employer's immediate family; [(c)] (iii) a minor under
23 seventeen years of age employed as a hand harvest worker on the same
24 farm as his parent or guardian and who is paid on a piece-rate basis at
25 the same piece rate as employees seventeen years of age or over; [(d)]
26 (iv) an individual employed or permitted to work for a federal, state,
27 or a municipal government or political subdivision thereof; or [(e)] (v)
28 an individual to whom the provisions of article nineteen of this chapter
29 are applicable.
30 (b) Such term shall not include any person performing a service if:
31 (i) the person is free from control and direction in connection with
32 the performance of the service, both under his or her contract for the
33 performance of service and in fact;
34 (ii) the service is performed outside of the usual course of the busi-
35 ness of an employer; and
36 (iii) the person is customarily engaged in an independently estab-
37 lished trade, occupation, profession or business of the same nature as
38 that involved in the service performed.
39 (c) The failure to withhold federal or state income taxes, or to pay
40 unemployment compensation contributions or workers' compensation premi-
41 ums with respect to a person's wages shall not be considered in making a
42 determination pursuant to this subdivision.
43 (d) A person's exercise of the option to secure workers' compensation
44 insurance with a carrier as a sole proprietor or partnership shall not
45 be considered in making a determination pursuant to this subdivision.
46 § 12. This act shall take effect on the first of January next succeed-
47 ing the date on which it shall have become a law; provided that, effec-
48 tive immediately, any rules and regulations necessary to implement the
49 provisions of this act on its effective date are authorized and directed
50 to be completed on or before such date.
