House Study Bill 546 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON COMMERCE BILL BY CHAIRPERSON COWNIE) A BILL FOR An Act defining marketplace contractors and designating 1 marketplace contractors as independent contractors under 2 specified circumstances. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5136YC (2) 87 gh/rn

H.F. _____ Section 1. NEW SECTION . 93.1 Definitions 1 As used in this chapter, unless the context otherwise 2 requires: 3 1. “Governmental entity” means the same as defined in 4 section 96.19. 5 2. “Indian tribe” means the same as defined in section 6 96.19. 7 3. “Marketplace contractor” means a person who does all of 8 the following: 9 a. Enters into a written agreement with a marketplace 10 platform to use the marketplace platform’s digital network 11 to connect with individuals or entities that seek to obtain 12 services from the marketplace contractor. 13 b. Performs services for individuals or entities upon 14 connection through a marketplace platform’s digital network in 15 exchange for compensation or payment of a fee. 16 4. “Marketplace platform” means a person who operates 17 a digital network to connect marketplace contractors to 18 individuals or entities that seek to obtain the type of 19 services offered by marketplace contractors. 20 5. “Person” means the same as defined in section 4.1. 21 Sec. 2. NEW SECTION . 93.2 Marketplace contractors as 22 independent contractors —— retroactivity. 23 1. A marketplace contractor shall be treated as an 24 independent contractor, and not an employee of a marketplace 25 platform, for all purposes under state or local law, including 26 but not limited to chapters 87 and 96, if the following 27 conditions are met: 28 a. The marketplace contractor and marketplace platform agree 29 in writing that the marketplace contractor is engaged as an 30 independent contractor and not an employee of the marketplace 31 platform. 32 b. The marketplace platform does not unilaterally prescribe 33 specific hours during which the marketplace contractor must 34 be available to accept service requests submitted through the 35 -1- LSB 5136YC (2) 87 gh/rn 1/ 3

H.F. _____ marketplace platform’s digital network. 1 c. The marketplace platform does not prohibit the 2 marketplace contractor from engaging in outside employment or 3 performing services through other marketplace platforms. 4 d. The marketplace contractor bears its own expenses 5 incurred in performing services. 6 2. For services performed by a marketplace contractor prior 7 to the effective date of this Act, a marketplace contractor 8 shall be treated as an independent contractor and not an 9 employee of a marketplace platform for all purposes under state 10 or local law, including but not limited to chapters 87 and 96, 11 if the conditions set forth in subsection 1 were satisfied at 12 the time the services were performed. 13 3. This section shall not apply to any of the following: 14 a. Services performed by an individual in the employ 15 of a governmental entity or Indian tribe, but only if the 16 services are excluded from employment as defined in the Federal 17 Unemployment Tax Act, 26 U.S.C. §3301-3311, solely by reason of 18 section 3306(c)(7) of that Act. 19 b. Services performed by an individual in the employ of a 20 religious, charitable, educational, or other organization, but 21 only if the services are excluded from employment as defined in 22 the Federal Unemployment Tax Act, 26 U.S.C. §3301-3311, solely 23 by reason of section 3306(c)(8) of that Act. 24 EXPLANATION 25 The inclusion of this explanation does not constitute agreement with 26 the explanation’s substance by the members of the general assembly. 27 This bill relates to marketplace contractors. 28 The bill defines “marketplace contractor” to mean a person 29 who enters into a written agreement with a marketplace platform 30 to use its digital network to connect with individuals or 31 entities that seek to obtain services from the marketplace 32 contractor and who performs services for individuals or 33 entities for payment upon connection through a marketplace 34 platform’s digital network. The bill defines “marketplace 35 -2- LSB 5136YC (2) 87 gh/rn 2/ 3

H.F. _____ platform” to mean a person who operates a digital network 1 to connect marketplace contractors to individuals or 2 entities seeking the type of services offered by marketplace 3 contractors. 4 The bill provides that a marketplace contractor shall be 5 treated as an independent contractor, and not an employee of 6 a marketplace platform, for all purposes under state or local 7 law, if the following conditions occur: the parties agree 8 in writing that the marketplace contractor is an independent 9 contractor and not an employee of the marketplace platform; the 10 marketplace platform does not unilaterally prescribe specific 11 hours during which the marketplace contractor must be available 12 to accept service requests; the marketplace platform does not 13 prohibit the marketplace contractor from engaging in outside 14 employment or performing services through other marketplace 15 platforms; and the marketplace contractor bears its own 16 expenses incurred in performing services. 17 The bill provides that for services performed by a 18 marketplace contractor prior to the effective date of the bill, 19 a marketplace contractor shall be treated as an independent 20 contractor if the conditions set forth in the bill were 21 satisfied at the time the services were performed. 22 The bill specifies that the bill does not apply to services 23 performed by an individual in the employ of a government entity 24 or Indian tribe, as defined in the bill, or services performed 25 by an individual in the employ of a religious, charitable, 26 educational, or other organization, but only if the services 27 are excluded from the definition of employment in the Federal 28 Unemployment Tax Act. 29 -3- LSB 5136YC (2) 87 gh/rn 3/ 3