HSB 558 (LSB 5268YC (4) 87)

HOUSE FILE _____ 

BY  (PROPOSED COMMITTEE ON COMMERCE BILL BY CHAIRPERSON COWNIE)

A BILL FOR

An Act relating to the independent contractor status of marketplace contractors performing services through the use of marketplace platforms and including retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  93.1  Definitions.
   For purposes of this chapter:
   1.  “Marketplace contractor” means any individual, corporation, partnership, sole proprietorship, or other entity that does all of the following:
   a.  Enters into an agreement with a marketplace platform to use the marketplace platform’s online-enabled application, software, internet site, or system to receive connections to third-party individuals or entities seeking services.
   b.  Offers or provides services in return for compensation to third-party individuals or entities upon connection through the marketplace platform’s online-enabled application, software, internet site, or system.
   2.  “Marketplace platform” means a corporation, partnership, sole proprietorship, or other entity operating in this state that offers an online-enabled application, software, internet site, or system that enables the provision of services by marketplace contractors to third-party individuals or entities seeking such services.
    Sec. 2.  NEW SECTION.  93.2  Status of marketplace contractors.
   A marketplace contractor shall be treated as an independent contractor, and not an employee, of a marketplace platform for all purposes under state law, including but not limited to chapters 87 and 96, and rules and local ordinances, amendments, resolutions, and motions, if all of the following conditions are met:
   1.  The marketplace contractor and marketplace platform agree in writing that the marketplace contractor is an independent contractor with respect to the marketplace platform.
   2.  The marketplace platform does not unilaterally prescribe specific hours during which the marketplace contractor must be available to accept service requests from third-party individuals or entities submitted through the marketplace platform’s online-enabled application, software, internet site, or system.
   3.  The marketplace platform does not prohibit the marketplace contractor from using any online-enabled application, software, internet site, or system offered by other marketplace platforms.
   4.  The marketplace platform does not restrict the marketplace contractor from engaging in any other occupation or business.
   5.  The marketplace contractor bears all or substantially all of the marketplace contractor’s own expenses that are incurred by the marketplace contractor in performing the services.
    Sec. 3.  NEW SECTION.  93.3  Exclusions.
   This chapter does not apply to the following services:
   1.  Services performed in the employ of a state, political subdivision of a state, or Indian tribe, or an instrumentality of a state, political subdivision of a state, or Indian tribe, which instrumentality is wholly owned by one or more states, political subdivisions, or Indian tribes, that are excluded from the definition of employment pursuant to 26 U.S.C. §3306(c) by reason of 26 U.S.C. §3306(c)(7).
   2.  Services performed in the employ of a religious, charitable, educational, or other organization that are excluded from the definition of employment pursuant to 26 U.S.C. §3306(c) solely by reason of 26 U.S.C. §3306(c)(8).
    Sec. 4.  RETROACTIVE APPLICABILITY.
   1.  This Act applies retroactively to services performed by a marketplace contractor prior to the effective date of this Act if all of the conditions set forth in section 93.2, as enacted by this Act, were met when the services were performed.
   2.  This section does not apply to an action, claim, or proceeding initiated prior to the effective date of this Act.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   This bill relates to the independent contractor status of marketplace contractors performing services through the use of marketplace platforms.
   The bill defines marketplace contractor as any individual, corporation, partnership, sole proprietorship, or other entity that enters into an agreement with a marketplace platform to use the platform’s online-enabled application, software, internet site, or system to receive connections to third-party individuals or entities seeking services, and that also offers or provides services in return for compensation to third-party individuals or entities upon connection through the marketplace platform’s online-enabled application, software, internet site, or system.
   The bill defines marketplace platform as a corporation, partnership, sole proprietorship, or other entity operating in this state that offers an online-enabled application, software, internet site, or system that enables the provision of services by marketplace contractors to third-party individuals or entities seeking such services. 
   The bill provides that a marketplace contractor shall be treated as an independent contractor, and not an employee, of a marketplace platform for all purposes under state law and rules and local ordinances, amendments, resolutions, and motions, if five specified conditions are all met.
   The bill does not apply to certain services excluded from employment as defined in 26 U.S.C. §3306(c).
   The bill applies retroactively to services performed by a marketplace contractor prior to the effective date of the bill if all of the conditions set forth in the bill were met when the service was performed. This provision does not apply to an action, claim, or proceeding initiated prior to the effective date of the bill.