House Study Bill 558 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON COMMERCE BILL BY CHAIRPERSON COWNIE) A BILL FOR An Act relating to the independent contractor status of 1 marketplace contractors performing services through the 2 use of marketplace platforms and including retroactive 3 applicability provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 5268YC (4) 87 je/rj

H.F. _____ Section 1. NEW SECTION . 93.1 Definitions. 1 For purposes of this chapter: 2 1. “Marketplace contractor” means any individual, 3 corporation, partnership, sole proprietorship, or other entity 4 that does all of the following: 5 a. Enters into an agreement with a marketplace platform 6 to use the marketplace platform’s online-enabled application, 7 software, internet site, or system to receive connections to 8 third-party individuals or entities seeking services. 9 b. Offers or provides services in return for compensation to 10 third-party individuals or entities upon connection through the 11 marketplace platform’s online-enabled application, software, 12 internet site, or system. 13 2. “Marketplace platform” means a corporation, partnership, 14 sole proprietorship, or other entity operating in this state 15 that offers an online-enabled application, software, internet 16 site, or system that enables the provision of services by 17 marketplace contractors to third-party individuals or entities 18 seeking such services. 19 Sec. 2. NEW SECTION . 93.2 Status of marketplace 20 contractors. 21 A marketplace contractor shall be treated as an independent 22 contractor, and not an employee, of a marketplace platform for 23 all purposes under state law, including but not limited to 24 chapters 87 and 96, and rules and local ordinances, amendments, 25 resolutions, and motions, if all of the following conditions 26 are met: 27 1. The marketplace contractor and marketplace platform 28 agree in writing that the marketplace contractor is an 29 independent contractor with respect to the marketplace 30 platform. 31 2. The marketplace platform does not unilaterally prescribe 32 specific hours during which the marketplace contractor must 33 be available to accept service requests from third-party 34 individuals or entities submitted through the marketplace 35 -1- LSB 5268YC (4) 87 je/rj 1/ 3

H.F. _____ platform’s online-enabled application, software, internet site, 1 or system. 2 3. The marketplace platform does not prohibit the 3 marketplace contractor from using any online-enabled 4 application, software, internet site, or system offered by 5 other marketplace platforms. 6 4. The marketplace platform does not restrict the 7 marketplace contractor from engaging in any other occupation 8 or business. 9 5. The marketplace contractor bears all or substantially 10 all of the marketplace contractor’s own expenses that are 11 incurred by the marketplace contractor in performing the 12 services. 13 Sec. 3. NEW SECTION . 93.3 Exclusions. 14 This chapter does not apply to the following services: 15 1. Services performed in the employ of a state, political 16 subdivision of a state, or Indian tribe, or an instrumentality 17 of a state, political subdivision of a state, or Indian tribe, 18 which instrumentality is wholly owned by one or more states, 19 political subdivisions, or Indian tribes, that are excluded 20 from the definition of employment pursuant to 26 U.S.C. 21 §3306(c) by reason of 26 U.S.C. §3306(c)(7). 22 2. Services performed in the employ of a religious, 23 charitable, educational, or other organization that are 24 excluded from the definition of employment pursuant to 26 25 U.S.C. §3306(c) solely by reason of 26 U.S.C. §3306(c)(8). 26 Sec. 4. RETROACTIVE APPLICABILITY. 27 1. This Act applies retroactively to services performed by a 28 marketplace contractor prior to the effective date of this Act 29 if all of the conditions set forth in section 93.2, as enacted 30 by this Act, were met when the services were performed. 31 2. This section does not apply to an action, claim, or 32 proceeding initiated prior to the effective date of this Act. 33 EXPLANATION 34 The inclusion of this explanation does not constitute agreement with 35 -2- LSB 5268YC (4) 87 je/rj 2/ 3

H.F. _____ the explanation’s substance by the members of the general assembly. 1 This bill relates to the independent contractor status of 2 marketplace contractors performing services through the use of 3 marketplace platforms. 4 The bill defines marketplace contractor as any individual, 5 corporation, partnership, sole proprietorship, or other entity 6 that enters into an agreement with a marketplace platform 7 to use the platform’s online-enabled application, software, 8 internet site, or system to receive connections to third-party 9 individuals or entities seeking services, and that also offers 10 or provides services in return for compensation to third-party 11 individuals or entities upon connection through the marketplace 12 platform’s online-enabled application, software, internet site, 13 or system. 14 The bill defines marketplace platform as a corporation, 15 partnership, sole proprietorship, or other entity operating in 16 this state that offers an online-enabled application, software, 17 internet site, or system that enables the provision of services 18 by marketplace contractors to third-party individuals or 19 entities seeking such services. 20 The bill provides that a marketplace contractor shall be 21 treated as an independent contractor, and not an employee, of a 22 marketplace platform for all purposes under state law and rules 23 and local ordinances, amendments, resolutions, and motions, if 24 five specified conditions are all met. 25 The bill does not apply to certain services excluded from 26 employment as defined in 26 U.S.C. §3306(c). 27 The bill applies retroactively to services performed by a 28 marketplace contractor prior to the effective date of the bill 29 if all of the conditions set forth in the bill were met when 30 the service was performed. This provision does not apply to an 31 action, claim, or proceeding initiated prior to the effective 32 date of the bill. 33 -3- LSB 5268YC (4) 87 je/rj 3/ 3