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2025 SENATE BILL 256
May 15, 2025 - Introduced by Senators BRADLEY, CABRAL-GUEVARA, TESTIN and
MARKLEIN, cosponsored by Representatives DALLMAN, BROOKS, ARMSTRONG,
ORTIZ-VELEZ, WICHGERS, WITTKE, SNYDER, KNODL and DITTRICH. Referred to
Committee on Utilities and Tourism.
AN ACT to amend 71.63 (2), 102.07 (8) (a) and 108.02 (12) (a); to create 71.05
(6) (a) 30., 71.05 (6) (b) 57., 71.83 (1) (f), 102.01 (2) (ae), 102.01 (2) (an), 102.01
(2) (ann), 102.01 (2) (anp), 102.01 (2) (ant), 102.01 (2) (dc), 102.01 (2) (ds),
102.01 (2) (gh), 102.07 (8) (bs), 103.08, 104.01 (2) (b) 6., 108.02 (12) (ds), 224.56
and 632.985 of the statutes; relating to: delivery network couriers and
transportation network drivers, Department of Financial Institutions[
approval to offer portable benefit accounts, providing for insurance coverage,
modifying administrative rules related to accident and sickness insurance,
and granting rule-making authority.
Analysis by the Legislative Reference Bureau
DELIVERY AND TRANSPORTATION NETWORK COMPANIES
General
This bill provides that under specific circumstances, delivery network couriers
and drivers for transportation network companies (application-based drivers) are
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not employees of the delivery network companies and transportation network
companies (network companies) for the purposes of worker [s compensation
insurance, minimum wage laws, and unemployment insurance. In the bill,
Xapplication-based driverY is defined as a delivery network courier or participating
driver who provides services through the online-enabled application, software,
website, or system of a network company.
Under the bill, if a network company does not engage in all of the following
practices, an application-based driver is not an employee or agent of the company: 1)
prescribe specific dates, times of day, or a minimum number of hours during which
the driver must be logged into the network company[s online-enabled application,
software, or system; 2) terminate the contract of the driver for not accepting a
specific request for transportation or delivery service request; 3) restrict the driver
from performing services through other network companies except while
performing services through that network company; and 4) restrict the driver from
working in any other lawful occupation or business. The bill provides that if this
provision is held invalid by a court, the provisions regarding portable benefits
accounts and group or blanket accident and sickness insurance coverage for
application based drivers are invalid.
Portable benefit accounts
Under the bill, if certain conditions are satisfied, a financial services provider
or other person may obtain approval from the Department of Financial Institutions
to offer portable benefit accounts. A Xportable benefit accountY is an account
administered by such an approved financial services provider or other person
(portable benefit account provider) from which an individual may receive
distributions for the purposes described below.
Under the bill, a network company may offer portable benefit accounts. If an
application-based driver meets certain eligibility requirements (eligible driver), a
network company may contribute an amount equal to 4 percent of that driver[s
quarterly earnings to a portable benefit account, and the driver may also contribute
to the portable benefit account. Contributions to a portable benefit account by the
account owner may be subtracted from the owner[s income for state income tax
purposes. Under the bill, an eligible driver may receive a distribution from a
portable benefit account for the following purposes: 1) to compensate for lost
income due to an illness or accident or loss of work due to the birth or adoption of
the driver[s child; 2) to transfer the money to an individual retirement account
(IRA); 3) to pay vision, dental, or health insurance premiums; and 4) to compensate
for lost income through no fault of the driver from work for a network company. A
network company must ensure that the portable benefit account provider it selects
offers at least three options for IRA providers and an eligible driver may not
transfer money from a portable benefit account to an IRA in an amount exceeding
the contribution limits under federal law. A portable benefit account provider may
include an income replacement benefit to be made available to eligible drivers. A 2025 - 2026 Legislature
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financial services provider may not commingle assets in a portable benefit account
with other property, except in a common trust fund or common investment fund.
Insurance coverage
The bill provides that a network company may carry, provide, or otherwise
make available group or blanket accident and sickness insurance for its application-
based drivers. The bill requires a network company to make available, upon
reasonable request, a copy of its group or blanket accident and sickness insurance
policy. The bill specifies that the state[s worker[s compensation laws do not apply to
such a policy.
The bill also provides that a network company may carry, provide, or
otherwise make available group or blanket occupational accident insurance to cover
the medical expenses and lost income resulting from an injury suffered by an
application-based driver while engaged on the network company[s online-enabled
application, software, or system. The bill requires a network company to make
available, upon reasonable request, a copy of its blanket occupational accident
insurance policy. The bill requires that the policy provide, in aggregate, at least
$1,000,000 of coverage for the medical expenses, short-term disability, long-term
disability, and survivor benefits. The coverage must include at least $250,000 for
medical expenses; weekly disability payments equal to two-thirds of an application-
based driver[s average weekly income, subject to certain restrictions, for up to 104
weeks following an injury; and survivor benefits in an amount equal to an
application-based driver[s average weekly income, subject to certain restrictions,
multiplied by 104. The bill provides that if a claim is covered by occupational
accident insurance maintained by more than one network company, the insurer of
the network company against whom a claim is filed is entitled to a contribution for
the pro rata share of coverage attributable to one or more other network companies.
Under the bill, any benefit provided to an application-based driver under an
occupational accident insurance policy is treated as amounts payable under a
worker[s compensation law or disability benefit for the purpose of determining
amounts payable under uninsured or underinsured motorist coverage.
Because this bill relates to an exemption from state or local taxes, it may be
referred to the Joint Survey Committee on Tax Exemptions for a report to be
printed as an appendix to the bill.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SECTION 1. 71.05 (6) (a) 30. of the statutes is created to read:
71.05 (6) (a) 30. For taxable years beginning after December 31, 2024, any
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amount distributed during the taxable year from a portable benefit account, as
defined in s. 103.08 (1) (h), that was not used for a permissible use under s. 103.08
(3), except that this subdivision applies only to amounts for which a subtraction was
made under par. (b) 57.
SECTION 2. 71.05 (6) (b) 57. of the statutes is created to read:
71.05 (6) (b) 57. For taxable years beginning after December 31, 2024, an
amount equal to any contribution made during the taxable year to a portable
benefit account, as defined in s. 103.08 (1) (h), by the owner of the account.
SECTION 3. 71.63 (2) of the statutes is amended to read:
71.63 (2) XEmployeeY means a resident individual who performs or performed
services for an employer anywhere or a nonresident individual who performs or
performed such services within this state, and includes an officer, employee or
elected official of the United States, a state, territory, or any political subdivision
thereof, or the District of Columbia, or any agency or instrumentality of any one or
more of these entities. The term includes an officer of a corporation, an entertainer
and an entertainment corporation, but does not include a direct seller who is not
treated as an employee under section 3508 of the Internal Revenue Code or, a real
estate broker or salesperson who is excluded under s. 452.38, or an application-
based driver excluded under s. 102.07 (8) (bs).
SECTION 4. 71.83 (1) (f) of the statutes is created to read:
71.83 (1) (f) Portable benefit accounts. An owner of a portable benefit account,
as defined in s. 103.08 (1) (h), who uses a distribution from the account for a
purpose that is not a permissible use under s. 103.08 (3) is liable for a penalty equal
to 10 percent of the amount of the distribution not used for a permissible use. The
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department shall assess, levy, and collect the penalty under this paragraph in the
same manner as it assesses, levies, and collects taxes under this chapter.
SECTION 5. 102.01 (2) (ae) of the statutes is created to read:
102.01 (2) (ae) XApplication-based driverY means a delivery network courier
or participating driver who provides services through the digital network of a
network company.
SECTION 6. 102.01 (2) (an) of the statutes is created to read:
102.01 (2) (an) XDelivery network companyY means a business that uses a
digital network to connect customers to application-based drivers to facilitate
delivery services.
SECTION 7. 102.01 (2) (ann) of the statutes is created to read:
102.01 (2) (ann) XDelivery network courierY means an individual who
provides delivery services through a delivery network company[s digital network.
SECTION 8. 102.01 (2) (anp) of the statutes is created to read:
102.01 (2) (anp) XDelivery servicesY means the fulfillment of a delivery
request by picking up from any location any item and delivering the item, by using
a passenger vehicle, a bicycle, a scooter, public transportation, or other similar
means of transportation or by walking, to a location selected by the customer that is
typically located within 50 miles of the pickup location. XDelivery servicesY
includes the selection, collection, or purchase of items by a delivery network courier,
as well as other tasks incidental to the delivery.
SECTION 9. 102.01 (2) (ant) of the statutes is created to read:
102.01 (2) (ant) XDigital networkY has the meaning given in s. 103.08 (1) (c).
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SECTION 10. 102.01 (2) (dc) of the statutes is created to read:
102.01 (2) (dc) XNetwork companyY means a delivery network company or a
transportation network company.
SECTION 11. 102.01 (2) (ds) of the statutes is created to read:
102.01 (2) (ds) XParticipating driverY has the meaning given in s. 440.40 (3).
SECTION 12. 102.01 (2) (gh) of the statutes is created to read:
102.01 (2) (gh) XTransportation network companyY has the meaning given in
s. 440.40 (6).
SECTION 13. 102.07 (8) (a) of the statutes is amended to read:
102.07 (8) (a) Except as provided in pars. (b) and, (bm), and (bs), every
independent contractor is, for the purpose of this chapter, an employee of any
employer under this chapter for whom he or she is performing service in the course
of the trade, business, profession or occupation of such employer at the time of the
injury.
SECTION 14. 102.07 (8) (bs) of the statutes is created to read:
102.07 (8) (bs) An application-based driver is not an employee or agent of a
network company if the company refrains from doing all of the following:
1. Prescribing specific dates, times of day, or a minimum number of hours
during which the application-based driver must be logged into the network
company[s online-enabled application, software, or system.
2. Terminating the contract of the application-based driver for not accepting a
specific delivery service request or request for transportation, except as prohibited
by s. 440.45 (2).
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3. Restricting the application-based driver from performing services through
other network companies except while performing services through that network
company.
4. Restricting the application-based driver from working in any other lawful
occupation or business.
SECTION 15. 103.08 of the statutes is created to read:
103.08 Application-based drivers; portable benefits accounts. (1)
DEFINITIONS. In this section:
(a) XApplication-based driverY has the meaning given in s. 102.01 (2) (ae).
(b) XDelivery network companyY has the meaning given in s. 102.01 (2) (an).
(c) XDigital networkY means an online-enabled application, software, website,
or system that enables the provision of delivery services with delivery network
couriers or the prearrangement of transportation network services as defined in s.
440.40 (1).
(d) XEarningsY means all moneys paid directly to an application-based driver,
including incentives and bonuses, by a delivery network company or a
transportation network company, or remitted to the application-based driver from a
payment facilitated by a delivery network company or transportation network
company, but not including amounts charged for fees, taxes, or other similar
charges. XEarningsY does not include any payments for gratuities.
(e) XEligible driverY means an application-based driver whose earnings from
an individual delivery network company or transportation network company totaled
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at least $750, without combining earnings from network companies or delivery and
rideshare services provided through the same company, during a calendar quarter.
(f) XLoss of earningsY means a decrease of 50 percent or more in earnings in a
calendar month from the previous calendar month through no fault of the
application-based driver.
(g) XNetwork companyY means a delivery network company or a
transportation network company.
(h) XPortable benefit accountY means an account from which an individual
may withdraw money for a permissible use under sub. (3) that is administered by a
portable benefit account provider.
(i) XPortable benefit account providerY means a financial services provider or
other person authorized under s. 224.56 (3) to offer and administer portable benefit
accounts.
(j) XTransportation network companyY has the meaning given in s. 440.40 (6).
(2) ADMINISTRATION AND CONTRIBUTIONS. (a) A network company may offer
portable benefit accounts to eligible drivers but is not required to offer such
accounts. A network company may make a contribution to a portable benefit
account of an eligible driver but is not required to make such a contribution.
(b) If a network company elects to offer portable benefit accounts to eligible
drivers, the network company shall ensure that any portable benefit account
provider it selects makes available to eligible drivers, under the portable benefit
account, at least 3 options for individual retirement account providers.
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(c) If a network company elects to make contributions to portable benefit
accounts of eligible drivers, all of the following apply:
1. The network company shall make any contribution to the default portable
benefit account the company elects on behalf of a driver unless the driver has
selected a different account and timely notified the network company.
2. If an application-based driver qualified as an eligible driver for an
individual network company for that network company for an entire calendar
quarter, each calendar quarter following a quarter in which the eligible driver so
qualified, the network company shall contribute to the portable benefit account of
the eligible driver an amount equal to 4 percent of the eligible driver[s earnings in
the preceding calendar quarter that the driver earned through that company. A
driver must qualify as an eligible driver individually for each network company.
The company shall make the contribution no later than the 30th day of the calendar
quarter.
(d) If a network company elects to offer portable benefit accounts to eligible
drivers, the network company shall allow an eligible driver to elect to contribute to
the eligible driver[s portable benefit account, and may deduct the amount elected by
the eligible driver from the individual[s earnings and designate such amount for
contribution to the portable benefit account. The company shall make the
contribution on behalf of the eligible driver no later than the 30th day of the
calendar quarter.
(e) A network company shall make contributions under par. (c) in addition to,
and not as a deduction from, driver earnings.
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(3) PERMISSIBLE USES. An eligible driver who has money in a portable benefit
account may receive a distribution of amounts for any of the following:
(a) To compensate for lost income due to any of the following:
1. An illness or accident of the driver.
2. Loss of work due to the birth or adoption of a child of the driver.
3. Loss of work due to declared federal state of emergency or emergency
declared by the governor under s. 323.10.
(b) To transfer the money to an individual retirement account, except that no
such transfer may be made in an amount that exceeds the limit established by
section 219 (b) (1) of the Internal Revenue Code for the aggregate amount of
contributions to an individual retirement account for the taxable year in which the
transfer is made.
(c) To pay premiums for health, vision, or dental insurance coverage in the
individual market.
(d) Loss of earnings.
(4) ELIGIBILITY DURATION. An eligible driver shall remain an eligible driver of
the delivery network company or transportation network company for 3 calendar
quarters following the initial quarter of eligibility, regardless of the amount of
earnings the application-based driver has during those 3 quarters. In each
subsequent calendar quarter an application-based driver may only qualify as an
eligible driver of the delivery network company or transportation network if the
driver has $750 of earnings in the calendar quarter.
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(5) NONSEVERABILITY. This section does not apply if a court finds s. 102.07 (8)
(bs) invalid.
SECTION 16. 104.01 (2) (b) 6. of the statutes is created to read:
104.01 (2) (b) 6. An individual excluded under s. 102.07 (8) (bs).
SECTION 17. 108.02 (12) (a) of the statutes is amended to read:
108.02 (12) (a) XEmployeeY means any individual who is or has been
performing services for pay for an employing unit, whether or not the individual is
paid directly by the employing unit, except as provided in par. (bm), (c), (d), (dm), or
(dn), or (ds).
SECTION 18. 108.02 (12) (ds) of the statutes is created to read:
108.02 (12) (ds) Paragraph (a) does not apply to an individual who is
performing services for an employing unit other than a government unit, an Indian
tribe, or a nonprofit organization and who is excluded under s. 102.07 (8) (bs).
SECTION 19. 224.56 of the statutes is created to read:
224.56 Portable benefit accounts. (1) In this section:
(a) XEligible driverY has the meaning given in s. 103.08 (1) (e).
(b) XFinancial services providerY means any of the following:
1. A financial institution, as defined in s. 214.01 (1) (jn).
2. An investment management firm.
3. A technology provider or program manager that offers services through a
financial services provider identified in subd. 1. or 2.
(c) XPortable benefit accountY has the meaning given in s. 103.08 (1) (h).
(d) XQualifying eventY means an event described in s. 103.08 (3) (a).
(2) A financial services provider or other person may request approval from
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the department to offer portable benefit accounts. If the financial services provider
or other person demonstrates to the satisfaction of the department that the manner
in which the financial services provider or other person will administer the
portable benefit account will be consistent with s. 103.08 (2) and (3), and the
financial services provider or other person satisfies any applicable rule under sub.
(7), the department shall approve the request.
(3) A financial services provider or other person approved by the department
under sub. (2) may offer and administer portable benefit accounts.
(4) A financial services provider or other person authorized to offer and
administer portable benefit accounts under sub. (3) may include an income
replacement benefit to be made available to eligible drivers upon the occurrence of
any qualifying event.
(5) A financial services provider may not commingle assets in a portable
benefit account with other property, except these assets may be held in a common
trust fund or common investment fund.
(6) A financial services provider shall ensure that, if at the time of an eligible
driver[s death the eligible driver has arranged for distributions from a portable
benefit account as provided in s. 103.08 (3) (b), the remaining balance in the
portable benefit account is immediately distributed in the form of a direct trustee-
to-trustee transfer to the eligible driver[s individual retirement account upon the
eligible driver[s death.
(7) The department may promulgate rules related to the process and
requirements for the department[s approval under sub. (2).
(8) This section does not apply if a court finds s. 102.07 (8) (bs) invalid.
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SECTION 20. 632.985 of the statutes is created to read:
632.985 Insurance coverage provided by network companies. (1)
DEFINITIONS. In this section:
(a) XApplication-based driverY has the meaning given in s. 102.01 (2) (ae).
(b) XAverage weekly earningsY means an application-based driver[s total
earnings from all network companies during the 28 days prior to a covered incident
divided by 4.
(c) XDigital networkY has the meaning given in s. 103.08 (1) (c).
(d) XEarningsY has the meaning given in s. 103.08 (1) (d).
(e) XMaximum compensation rate Y means the applicable maximum
compensation rate under s. 102.11 and any applicable limitation on supplemental
benefits under s. 102.44.
(f) XNetwork companyY means a delivery network company, as defined in s.
102.01 (2) (an), or a transportation network company, as defined in s. 440.40 (6).
(2) ACCIDENT AND SICKNESS INSURANCE. (a) A network company may carry,
provide, or otherwise make available group or blanket accident and sickness
insurance coverage for application-based drivers who provide covered services
through the network company[s digital network.
(b) A network company shall make available, upon reasonable request, a copy
of the policy it carries, provides, or otherwise makes available under this
subsection.
(c) Chapter 102 does not apply to a group or blanket accident and sickness
insurance policy described in par. (a).
(3) OCCUPATIONAL ACCIDENT INSURANCE. (a) A network company may carry,
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provide, or otherwise make available group or blanket occupational accident
insurance to cover the medical expenses and lost income resulting from an injury
suffered by an application-based driver while engaged on the network company[s
digital network. For purposes of this paragraph, an application-based driver is
engaged on the network company[s digital network during the time beginning when
the application-based driver accepts a rideshare request or delivery request and
ending when the application-based driver completes that rideshare request or
delivery request.
(b) A network company shall make available, upon reasonable request, a copy
of the policy it carries, provides, or otherwise makes available under this
subsection.
(c) A policy under this subsection shall provide, in aggregate, at least
$1,000,000 of coverage and at least all of the following:
1. $250,000 of coverage for medical expenses.
2. Continuous weekly disability income payments for total disability,
temporary disability payments, or partial disability that are equal to not less than
66 2/3 percent of the application-based driver[s average weekly earnings from all
network companies as of the date of injury but not more than the maximum
compensation rate, unless the application-based driver[s average weekly earnings
are less than $100, in which case the payments under this subdivision shall be
equal to the application-based driver[s average weekly earnings. Payments under
this paragraph shall be made for up to the first 104 weeks following the injury.
3. For the benefit of spouses, children, or other dependents of app-based
drivers, accidental death insurance, for injuries suffered by an application-based
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driver while the application-based driver is engaged on the network company[s
digital network that result in death, in an amount equal to 66 2/3 percent of the
application-based driver[s average weekly earnings from all network companies as
of the date of injury but not more than the maximum weekly compensation rate,
unless the application-based driver[s average weekly earnings are less than $100, in
which case the amount shall be equal to the application-based driver[s average
weekly earnings, multiplied by 104.
(d) If a claim is covered by occupational accident insurance maintained by
more than one network company, the insurer of the network company against whom
a claim is filed is entitled to a contribution for the pro rata share of coverage
attributable to one or more other network companies up to the coverages and limits
in par. (c).
(e) Any benefit provided to an application-based driver under an occupational
accident insurance policy described in par. (a) shall be treated as amounts payable
under a worker[s compensation law or disability benefit for the purpose of
determining amounts payable under insurance provided under s. 632.32 (4) or (4m).
(4) NONSEVERABILITY. This section does not apply if a court finds s. 102.07 (8)
(bs) invalid.
SECTION 21. INS 3.14 (6) (intro.), (a), (b) and (c) of the administrative code are
amended to read:
INS 3.14 (6) (intro.) ELIGIBLE GROUPS. In accordance with s. 600.03 (23),
Stats., an eligible group includes any of the following:
(a) The members of the board of directors of a corporation are eligible to be
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covered under a group accident and sickness policy issued to such corporation,
corporation.
(b) The individual members of member organizations of an association, as
defined in s. 600.03 (23), Stats., are eligible to be covered under a group accident
and sickness policy issued to such association insuring employees of such
association and employees of member organizations of such association, and.
(c) The individuals supplying raw materials to a single processing plant and
the employees of such processing plant are eligible to be covered under a group
accident and sickness policy issued to such processing plant.
SECTION 22. INS 3.14 (6) (d) of the administrative code is created to read:
INS 3.14 (6) (d) Application-based drivers, as defined in s. 632.985 (1) (a),
Stats., of a network company, as defined in s. 632.985 (1) (f), Stats., covered under a
group accident and sickness policy issued to the network company. This paragraph
does not apply if a court finds s. 102.07 (8) (bs), Stats., invalid.
SECTION 23. INS 3.15 (4) (a) 16. of the administrative code is created to read:
INS 3.15 (4) (a) 16. Application-based drivers, as defined in s. 632.985 (1) (a),
Stats., of a network company, as defined in s. 632.985 (1) (f), Stats. This subdivision
does not apply if a court finds s. 102.07 (8) (bs), Stats., invalid.
SECTION 24. Effective dates. This act takes effect on the day after
publication, except as follows:
(1) The treatment of administrative rules takes effect as provided in s.
227.265.
(END)
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