99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB2895

 

Introduced 2/18/2016, by Sen. James F. Clayborne, Jr.

 

SYNOPSIS AS INTRODUCED:
 
820 ILCS 105/3  from Ch. 48, par. 1003
820 ILCS 105/3.5 new

    Amends the Minimum Wage Law. Sets forth the criteria for establishing that a person is conclusively presumed to be an independent contractor. Effective immediately.


LRB099 16927 JLS 41274 b

 

 

A BILL FOR

 

SB2895LRB099 16927 JLS 41274 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 Minimum Wage Law is amended by changing
5Section 3 and by adding Section 3.5 as follows:
 
6    (820 ILCS 105/3)  (from Ch. 48, par. 1003)
7    Sec. 3. As used in this Act:
8    (a) "Director" means the Director of the Department of
9Labor, and "Department" means the Department of Labor.
10    (b) "Wages" means compensation due to an employee by reason
11of his employment, including allowances determined by the
12Director in accordance with the provisions of this Act for
13gratuities and, when furnished by the employer, for meals and
14lodging actually used by the employee.
15    (c) "Employer" includes any individual, partnership,
16association, corporation, limited liability company, business
17trust, governmental or quasi-governmental body, or any person
18or group of persons acting directly or indirectly in the
19interest of an employer in relation to an employee, for which
20one or more persons are gainfully employed on some day within a
21calendar year. An employer is subject to this Act in a calendar
22year on and after the first day in such calendar year in which
23he employs one or more persons, and for the following calendar

 

 

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1year.
2    (d) "Employee" includes any individual permitted to work by
3an employer in an occupation, but does not include any
4individual permitted to work:
5        (1) For an employer employing fewer than 4 employees
6    exclusive of the employer's parent, spouse or child or
7    other members of his immediate family.
8        (2) As an employee employed in agriculture or
9    aquaculture (A) if such employee is employed by an employer
10    who did not, during any calendar quarter during the
11    preceding calendar year, use more than 500 man-days of
12    agricultural or aquacultural labor, (B) if such employee is
13    the parent, spouse or child, or other member of the
14    employer's immediate family, (C) if such employee (i) is
15    employed as a hand harvest laborer and is paid on a piece
16    rate basis in an operation which has been, and is
17    customarily and generally recognized as having been, paid
18    on a piece rate basis in the region of employment, (ii)
19    commutes daily from his permanent residence to the farm on
20    which he is so employed, and (iii) has been employed in
21    agriculture less than 13 weeks during the preceding
22    calendar year, (D) if such employee (other than an employee
23    described in clause (C) of this subparagraph): (i) is 16
24    years of age or under and is employed as a hand harvest
25    laborer, is paid on a piece rate basis in an operation
26    which has been, and is customarily and generally recognized

 

 

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1    as having been, paid on a piece rate basis in the region of
2    employment, (ii) is employed on the same farm as his parent
3    or person standing in the place of his parent, and (iii) is
4    paid at the same piece rate as employees over 16 are paid
5    on the same farm.
6        (3) In domestic service in or about a private home.
7        (4) As an outside salesman.
8        (5) As a member of a religious corporation or
9    organization.
10        (6) At an accredited Illinois college or university
11    employed by the college or university at which he is a
12    student who is covered under the provisions of the Fair
13    Labor Standards Act of 1938, as heretofore or hereafter
14    amended.
15        (7) For a motor carrier and with respect to whom the
16    U.S. Secretary of Transportation has the power to establish
17    qualifications and maximum hours of service under the
18    provisions of Title 49 U.S.C. or the State of Illinois
19    under Section 18b-105 (Title 92 of the Illinois
20    Administrative Code, Part 395 - Hours of Service of
21    Drivers) of the Illinois Vehicle Code.
22        (8) An individual described in Section 3.5.
23    The above exclusions from the term "employee" may be
24further defined by regulations of the Director.
25    (e) "Occupation" means an industry, trade, business or
26class of work in which employees are gainfully employed.

 

 

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1    (f) "Gratuities" means voluntary monetary contributions to
2an employee from a guest, patron or customer in connection with
3services rendered.
4    (g) "Outside salesman" means an employee regularly engaged
5in making sales or obtaining orders or contracts for services
6where a major portion of such duties are performed away from
7his employer's place of business.
8    (h) "Day camp" means a seasonal recreation program in
9operation for no more than 16 weeks intermittently throughout
10the calendar year, accommodating for profit or under
11philanthropic or charitable auspices, 5 or more children under
1218 years of age, not including overnight programs. The term
13"day camp" does not include a "day care agency", "child care
14facility" or "foster family home" as licensed by the Illinois
15Department of Children and Family Services.
16(Source: P.A. 94-1025, eff. 7-14-06; 95-945, eff. 1-1-09.)
 
17    (820 ILCS 105/3.5 new)
18    Sec. 3.5. Independent contractor; presumption.
19    (a) For the purposes of this Act, a person is conclusively
20presumed to be an independent contractor if:
21        (1) unless the person is a foreign national who is
22    legally present in the United States, the person possesses
23    or has applied for an employer identification number or
24    social security number or has filed an income tax return
25    for a business or earnings from self-employment with the

 

 

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1    Internal Revenue Service in the previous year;
2        (2) the person is required by the contract with the
3    principal to hold any necessary State or local business
4    license and to maintain any necessary occupational
5    license, insurance, or bonding; and
6        (3) the person satisfies 3 or more of the following
7    criteria:
8            (A) Notwithstanding the exercise of any control
9        necessary to comply with any statutory, regulatory, or
10        contractual obligations, the person has control and
11        discretion over the means and manner of the performance
12        of any work and the result of the work, rather than the
13        means or manner by which the work is performed, is the
14        primary element bargained for by the principal in the
15        contract.
16            (B) Except for an agreement with the principal
17        relating to the completion schedule, range of work
18        hours or, if the work contracted for is entertainment,
19        the time such entertainment is to be presented, the
20        person has control over the time the work is performed.
21            (C) The person is not required to work exclusively
22        for one principal unless:
23                (i) a law, regulation, or ordinance prohibits
24            the person from providing services to more than one
25            principal; or
26                (ii) the person has entered into a written

 

 

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1            contract to provide services to only one principal
2            for a limited period.
3            (D) The person is free to hire employees to assist
4        with the work.
5            (E) The person contributes a substantial
6        investment of capital in the business of the person
7        including, without limitation, the:
8                (i) purchase or lease of ordinary tools,
9            material, and equipment regardless of source;
10                (ii) obtaining of a license or other
11            permission from the principal to access any work
12            space of the principal to perform the work for
13            which the person was engaged; and
14                (iii) lease of any work space from the
15            principal required to perform the work for which
16            the person was engaged.
17    The determination of whether an investment of capital is
18substantial for the purpose of this subsection must be made on
19the basis of the amount of income the person receives, the
20equipment commonly used, and the expenses commonly incurred in
21the trade or profession in which the person engages.
22    (b) The fact that a person is not conclusively presumed to
23be an independent contractor for failure to satisfy 3 or more
24of the criteria set forth in paragraph (3) of subsection (a)
25does not automatically create a presumption that the person is
26an employee.

 

 

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1    (c) As used in this Section, "foreign national" has the
2meaning ascribed to it in 52 U.S.C 30121.
 
3    Section 99. Effective date. This Act takes effect upon
4becoming law.