Regular Session 2009-2010 House Bill 400 P.N. 1652 Amendment 2009 970

H0400B1652A00970 MSP:SRA 04/29/09 #90 A00970

AMENDMENTS TO HOUSE BILL NO. 400

Printer's No. 1652

Amend Bill, page 3, line 29, by striking out "will continue

to be" and inserting

Amend Bill, page 4, lines 15 through 19, by striking out "For

purposes of this paragraph, an office may be " in line 15 and

all of lines 16 through 19

Amend Bill, page 4, line 22, by striking out "scope of"

Amend Bill, page 4, line 24, by striking out "independent

contractor to" and inserting

personnel to

Amend Bill, page 4, lines 25 through 30; page 5, line 1, by

striking out "unless " in line 25, all of lines 26 through 30,

page 4 and "force" in line 1, page 5 and inserting

other than employees of the independent contractor and other

contractors that can demonstrate by credible evidence that they

meet the criteria of this subsection

Amend Bill, page 6, lines 12 through 14, by striking out

"with the intent of evading the requirements of the " in line 12

and all of lines 13 and 14

Amend Bill, page 6, line 21, by inserting after "General"

or the District Attorney of the appropriate county

Amend Bill, page 7, by inserting between lines 8 and 9

Section 6.1 Presumption of independent contractor status.

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(a) Rebuttable presumption.—-An employer that enters into a

written contract for construction services containing the

requirements set forth under subsection (b) creates a rebuttable

presumption that the individual contracted with is an

independent contractor and the employer has an affirmative

defense to an allegation under this act that the individual is

an employee if all of the following are true:

(1) The contract is signed by both parties.

(2) The employer has in its possession the documents

identified in subsection (c).

(b) Contract terms.—-A written contract between an employer

and an individual presumed to be an independent contractor under

this section must contain all of the following:

(1) The name, home and business address of the

individual and the individual’s tax identification number or

Social Security Number.

(2) A description of the work to be performed under the

contract and plain, precise terms for payment.

(3) A section in substantially the following form:

Independent Contractor Status. The parties to this contract

acknowledge that they intend that the Contractor be

considered an independent contractor as described in the act

of ______________, 2009 (P.L. ___, No. ___), known as the

Construction Workplace Fraud Act (the "Act") and not an

employee of the Hiring Party. In furtherance of that

intention, the parties agree as follows:

(A) By his signature on this contract below, the

Contractor certifies that he meets all of the following

criteria:

(i) He maintains a separate business location

that is separate from the location of the Hiring

Party, with the Contractor’s own office, and

operates with owned or leased equipment and other

facilities.

(ii) He operates under contracts which are in

writing and which articulate plainly the precise

terms of payment for work performed, the work to be

performed and a specific prohibition against the

retention by the Contractor of any other personnel

to perform any part of the work described in the

contracts other than employees of the Contractor and

other contractors that can demonstrate, by credible

evidence, that they meet all of the criteria of this

paragraph (A).

(iii) He includes income and losses from

services rendered in a Federal income tax schedule

as an independent business or profession.

(iv) He will incur the primary expenses related

to the work performed under this contract.

(v) He is responsible for the satisfactory

completion of the work to be performed under this

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contract and is liable for a failure to complete the

work.

(vi) He realizes a profit or loss under

contracts to perform work.

(vii) The success or failure of his business

depends on the relationship of business receipts to

expenditures.

(viii) He has through ownership, or a written and

executed leasing arrangement with a person other than

the Hiring Party, the tools, equipment and other

assets necessary to perform the work under this

contract.

(ix) He makes services available to other

businesses, governmental agencies in this

Commonwealth or to the general public through

business advertising, solicitation or other

marketing efforts reasonably calculated to obtain

new contracts to provide similar services.

(x) He has continuing or recurring business

liabilities or obligations.

(xi) He performs services through a business in

which the Contractor has a principal proprietary

interest.

(xii) He is a United States citizen or is

authorized under Federal law to work in the United

States, as defined under section 274A of the

Immigration and Nationality Act (66 Stat. 163, 8

U.S.C. §1324a).

The foregoing are collectively referred to herein as the

"Independent Contractor Requirements." Failure of the

Contractor to meet the Independent Contractor

Requirements during the term of this contract shall

constitute a material breach by the Contractor of this

contract. In that event, the Hiring Party shall have

the right to terminate this contract immediately upon

notice to the Contractor without penalty.

(B) By his signature on this contract below, the

Hiring Party certifies that he has verified, after

reasonable investigation, that as of the date of this

contract the Contractor meets the Independent Contractor

Requirements except for those requirements set forth in

subparagraphs (iii), (vi), (vii), (ix) and (xi) of

paragraph (A) above, which he has not verified.

any other personnel to perform any part of the work

described in this contract other than employees of the

Contractor and other contractors that can demonstrate by

credible evidence that they meet all of the Independent

Contractor Requirements.

(D) The Contractor agrees that he shall maintain

liability insurance during the term of this contract of

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at least $1,000,000 and shall provide proof thereof to

the Hiring Party upon request.

contract described in subsection (b), the employer shall obtain

from the individual, and maintain for a period of three years

thereafter, the following information:

(1) Proof of liability insurance in the amount of at

least $1,000,000.

(2) Proof that the individual is a United States

citizen or is otherwise authorized under Federal law to work

in the United States, as defined under section 274A of the

Immigration and Nationality Act (66 Stat. 163, 8 U.S.C. §

1324a).

(d) Loss of presumption.—-If, during the term of the

contract, the employer receives knowledge that the individual

does not meet the criteria set forth in section 4(b) and the

employer does not terminate the contract as permitted by the

provisions of the contract set forth in subsection (b), the

employer shall no longer be entitled to the presumption and

affirmative defense set forth in subsection (a).

(e) Penalty.—-An employer that signs a contract described

in subsection (b) knowing that any of the certifications made by

the employer in the contract is false shall be subject to the

administrative penalties set forth in section 7(b) in addition

to any other penalties for violation of this act to which the

employer may be subject.

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