SSHB705 4145 3966
HOUSE SUMMARY OF SENATE AMENDMENTS
HB 705 2021 Regular Session Riser
UNEMPLOYMENT COMP: Provides relative to the misclassification of employees and a
criteria for the classification of employees
Synopsis of Senate Amendments
1.Provides that the penalty shall be waived for the first offense, if the employer
becomes compliant within sixty days of the citation.
2.Provides that one-half of any administrative penalties assessed pursuant to
present law shall be deposited into the state's unemployment trust fund.
3.Deletes the definition of "independent contractor".
4.Provides that there shall be a rebuttable presumption of an independent
contractor relationship with the contracting party for whom the independent
contractor performs work, if an individual or entity, which controls the
performance, methods, or processes used to perform services, meets specified
criteria.
5.Reduces the criteria an independent contractor must meet in order to have a
rebuttable presumption from seven to six.
6.Deletes proposed law that provides that the contracting party does not direct or
oversee the performance, methods, or processes of the individual or entity used
to perform services as a single criterion for an independent contractor
relationship.
7.Deletes proposed law that provides that obtainment of an independent
contractor certification from the state is optional and is not required to establish
independent contractor status.
8.Provides that proposed law shall not apply to any service excluded from the
term "employment" as provided in present law.
9.Provides that proposed law shall not apply to any service performed in the
employ of a state, any political subdivision of the state, or of an Indian tribe if
the service is excluded from employment as defined in the Federal
Unemployment Tax Act.
10.Provides that proposed law shall not apply to any service performed by an
individual in the employ of a religious, charitable, educational, or other
organization, but only if the service is excluded from employment as defined
in the Federal Unemployment Tax Act.
11.Provides that proposed law shall be known and may be cited as "The Ernest C.
Stephens Act".
12.Provides that proposed law shall not apply to any person or organization
licensed by the Dept. of Insurance, any securities broker-dealer, or any
investment adviser or their agents and representatives who are registered with
the Securities and Exchange Commission, the Financial Industry Regulatory
Authority, or licensed by the state of Louisiana.
13.Makes technical changes.
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Digest of Bill as Finally Passed by Senate
Present law provides that if, after an investigation, the administrator determines that an
employer, or any officer, agent, superintendent, foreman, or employee of the employer, failed
to properly classify an individual as an employee and failed to pay contributions and that
failure was not knowingly or willfully, the employer will be issued a written warning. Present
law further provides that the written warning shall constitute as evidence that the employer
has been cited for a first offense for misclassification.
Proposed law repeals present law.
Present law provides that the administrator may assess an administrative penalty of not more
than $250 per each employer who has misclassified an employee and failed to pay
contributions.
Proposed law changes the administrative penalty amount from $250 to $500, but waives this
penalty if the employer becomes compliant within 60 days of the citation for the first offense.
Proposed law provides that after the first offense, the administrator shall assess an
administrative penalty of $1,000 per each individual who is misclassified.
Present law provides that an employer who fails to properly classify an individual as an
employee and pay contributions, shall be subject to an administrative penalty of not more
than $500.
Proposed law changes the administrative penalty amount from $500 to $2,500.
Present law provides that after an employer has been issued a written warning and is
subsequently found on two or more separate occasions to have still misclassified an
employee, the employer may also be subject to an additional fine of not less than $100 nor
more than $1,000, or be imprisoned for not less than 30 days nor more than 90 days, or both.
Proposed law repeals present law.
Proposed law provides that one-half of any administrative penalty assessed pursuant to
proposed law shall be deposited into the state's unemployment trust fund.
Proposed law provides that if an individual or entity meets at least six of 11 criteria listed in
proposed law, there shall be a rebuttable presumption of an independent contractor
relationship with the contracting party for whom the independent contractor performs work,
if an individual or entity controls the performance, methods, or processes and meets those
certain criteria.
Proposed law provides that any contracting party or independent contractor may rely on the
provisions of proposed law to establish an employment or independent contractor
relationship.
Proposed law provides that proposed law shall not apply to any motor carrier who pursuant
to a contract with an owner operator as defined in present law undertakes the performance
of services as a motor carrier, any service excluded from the term "employment" as provided
in present law, and any service performed for a nonprofit organization that is exempt from
taxation under federal law.
Proposed law provides that proposed law shall not apply to any service excluded from the
term employment as provided in present law.
Proposed law provides that proposed law shall not apply to any service performed in the
employ of a state, any political subdivision of the state, or of an Indian tribe if the service is
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excluded from employment as defined in the Federal Unemployment Tax Act.
Proposed law provides that proposed law shall not apply to any service performed by an
individual in the employ of a religious, charitable, educational, or other organization, but
only if the service is excluded from employment as defined in the Federal Unemployment
Tax Act.
Proposed law provides that the provisions of proposed law shall not apply to any person or
organization licensed by the Dept. of Insurance, any securities broker-dealer, or any
investment adviser or their agents and representatives who are registered with the Securities
and Exchange Commission, the Financial Industry Regulatory Authority, or licensed by the
state.
Proposed law provides that proposed law shall be known and may be cited as "The Ernest
C. Stephens Act".
(Amends R.S. 23:1711(G)(1); Adds R.S. 23:1711.1)
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