HF 2448 (LSB 6809HH (2) 91)

HOUSE FILE 2448

BY  THOMSON

A BILL FOR

An Act relating to the requirements for business entities’ telephone communications with consumers in this state.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  554J.1  Business entities’ telephone communications.
   1.  As used in this section, unless the context otherwise requires:
   a.  (1)  “Business entity” means a domestic or foreign sole proprietorship, corporation, association, partnership, limited liability company, limited liability partnership, or other similar form of business organization or legal entity that is regulated by state law and that meets all of the following requirements:
   (a)  The entity conducts business with consumers in the state.
   (b)  The entity’s annual gross revenue in the state exceeds thirty million dollars per calendar year.
   (2)  “Business entity” does not include a domestic or foreign sole proprietorship, corporation, association, partnership, limited liability company, limited liability partnership, or other business organization or legal entity that is regulated by federal law.
   b.  “Conducts business” means the sale of goods or services, subscriptions, leases, rentals, or warranties by a business entity, financing arrangements tied to consumer products, or any other transactional relationship between a business entity and a consumer in the state.
   c.  “Director” means the director of the department of insurance and financial services.
   d.  “Representative” means an individual human being that is an agent of, and that is authorized by, a business entity to speak on the business entity’s behalf, and who can verbally communicate in English.
   2.  a.  Except as otherwise provided by federal law, a business entity shall maintain a minimum of one publicly accessible telephone number that is available to consumers in the state to contact the business entity for the purpose of consumer inquiries related to billing, accounts, service issues, transactions, or questions reasonably related to the business entity’s regularly conducted business.
   b.  A representative shall be available during a business entity’s publicly posted customer service hours to communicate with consumers in the state using the telephone number under paragraph “a”.
   3.  a.  A business entity may use an automated response system except that an automated response system shall not require more than three menu prompts before providing the option to route the call directly to a representative. An automated response system shall not include infinite loops, circular phone trees, or any other system designed to prevent or delay connection to a representative.
   b.  A business entity shall not engage in a call-routing practice that intentionally delays connecting a consumer to a representative, repeatedly disconnects a consumer call, recycles a consumer through a menu, or otherwise substantially impedes a consumer’s access to a representative. A business entity shall ensure that a consumer that selects an option to speak to a representative is connected to a representative within two minutes after selecting such option.
   4.  a.  A business entity that violates this section shall be subject to civil penalties in an amount set by the director by rule.
   b.  The attorney general may bring an action in a district court to enjoin a violation of this section.
   c.  A consumer injured by a violation of this section may bring an action in district court to recover damages including actual damages, statutory damages in an amount no less than five hundred dollars per violation, and reasonable attorney fees and court costs.
   d.  A plaintiff in a class action against a business entity for violation of this section may only recover actual damages and reasonable attorney fees.
   e.  Prior to the assessment of a civil penalty or the initiation of a civil action, a business entity shall be permitted a reasonable amount of time to demonstrate compliance with this section through documented staffing plans, call center metrics, and call center recordings.
   5.  This section shall not apply to a business entity for which federal laws or rules preempt state laws and rules governing customer service operations, including but not limited to:
   a.  National banks, federal savings associations, credit unions, or other business entities regulated by the office of the comptroller of the currency of the United States department of treasury or the national credit union administration.
   b.  Interstate telecommunications carriers regulated by the federal communications commission or subject to the federal Communications Act of 1934, 47 U.S.C. §151 et seq.
   c.  Airline carriers regulated by the federal Airline Deregulation Act of 1978, Pub. L. No. 95-504.
   d.  Motor carriers, freight brokers, and logistics companions regulated by the federal Aviation Administration Authorization Act of 1994, Pub. L. No. 103-305.
   6.  The director shall adopt rules pursuant to chapter 17A to administer and enforce this section, including but not limited to rules providing for:
   a.  The frequency and manner by which the director will test and verify a business entity’s compliance with this section.
   b.  The procedures for a consumer to file a complaint regarding a violation of this section with the attorney general.
   c.  The civil penalties imposed pursuant to subsection 4, paragraph “a”.
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 requirements for business entities’ telephone communications with consumers in this state.
   Under the bill, except as otherwise provided by federal law, a business entity (business) shall maintain a telephone number that is available to consumers to contact the business regarding inquiries or questions reasonably related to the business’s regularly conducted business. A business shall have a representative available during customer service hours to communicate with consumers using the business’s telephone number. “Business entity”, “conduct business”, and “representative” are defined in the bill.
   A business may use an automated response system, but the system shall not require more than three menu prompts before providing the option to route the call directly to a representative, and shall not include infinite loops, circular phone trees, or any other system designed to prevent or delay connection to a representative. A business shall not engage in a call-routing practice that intentionally delays connecting a consumer to a representative, repeatedly disconnects a call, recycles a caller through a menu, or otherwise substantially impedes a consumer’s access to a representative.
   A business shall ensure that a consumer that selects an option to speak to a representative is connected to a representative within two minutes.
   A business that violates the bill shall be subject to civil penalties in an amount set by the director of the department of insurance and financial services (director) by rule. The attorney general may bring an action in a district court to enjoin a violation of the bill. A consumer injured by a violation may bring an action for damages including actual damages, statutory damages in an amount no less than $500 per violation, and reasonable attorney fees and court costs. A plaintiff in a class action against a business may only recover actual damages and reasonable attorney fees. Prior to the assessment of a civil penalty or the initiation of an action, a business shall be permitted a reasonable amount of time to demonstrate compliance with the bill.
   The bill does not apply to a business for which federal law or rule expressly or impliedly preempts state customer service operations.
   The director shall adopt rules to administer the bill, including rules providing for the testing and verification of a business’s compliance with the bill, the procedures for a consumer to file a complaint regarding a violation of the bill, and the amount of civil penalties imposed on a business for violation of the bill.