Bill Text: MI SB0645 | 2015-2016 | 98th Legislature | Introduced
Bill Title: Labor; fair employment practices; employee misclassification; establish uniform criteria. Creates new act.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2016-10-20 - Referred To Committee Of The Whole With Substitute S-1 [SB0645 Detail]
Download: Michigan-2015-SB0645-Introduced.html
SENATE BILL No. 645
December 8, 2015, Introduced by Senator KOWALL and referred to the Committee on Commerce.
A bill to establish uniform criteria for determining an
employee-employer relationship for purposes of the laws of this
state; to prohibit misclassification of employees in reports
required of employers by this state; and to provide sanctions.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"employee classification act".
Sec. 2. (1) As used in this act, "misclassify" means to fail
to properly identify an individual as performing services in
employment in an employer-employee relationship with an employer.
Except for employment in the trucking and messenger courier
industries, an employer-employee relationship is determined using
the 20-factor test announced by the Internal Revenue Service of the
United States Department of Treasury in Revenue Ruling 87-41, 1987-
1 C.B. 296. In the trucking and messenger courier industries, an
individual who is the operator of a vehicle or vessel is an
employee, unless all of the following apply:
(a) The individual owns the vehicle or vessel or holds it
under a bona fide lease arrangement that is not through an
arrangement, loan, or loan guarantee with the contracting entity or
any affiliate of the contracting entity. This requirement does not
apply to temporary replacement lease agreements.
(b) The individual is responsible for substantially all of the
principal operating costs of the vehicle or vessel and equipment,
including maintenance, fuel, repairs, supplies, vehicle insurance,
and personal expenses. If the contracting entity pays the
individual only a fuel surcharge and incidental costs, such as
tolls, permits, or lumper fees, the individual meets the
requirements of this subdivision.
(c) The individual is responsible for supplying the necessary
services to operate the vehicle or vessel and equipment.
(d) The individual's compensation is based on factors related
to the work performed, such as a mileage-based rate or a percentage
of any schedule of rates, and is not solely based on hours or time
expended.
(e) The individual substantially controls the means and manner
of performing services in conformance with regulatory requirements
and specifications of a shipper.
(f) The contracting entity and the individual sign and date an
agreement that the individual will substantially meet the
conditions in subdivisions (a) to (e) and that the individual
agrees to be an independent contractor and not an employee. The
agreement shall be produced on the demand of the director or the
director's agent.
(2) An individual from whom an employer is required to
withhold federal income tax is prima facie considered to perform
services in employment in an employment relationship for purposes
of classification as an employee.
Sec. 3. An employer or an agent of an employer shall not
misclassify an employee in a report required under the laws of this
state. If the misclassification results in a lessening or avoidance
of a legal obligation to the employee, another individual, or this
state, the employer or agent is subject to the sanctions provided
in the statute under which the report was required.
