§ 861-C — Presumption of employment in the construction industry

§ 861-c. Presumption of employment in the construction industry. 1.\nAny person performing services for a contractor shall be classified as\nan employee unless the person is a separate business entity under\nsubdivision two of this section or all of the following criteria are\nmet, in which case the person shall be an independent contractor:\n (a) the individual is free from control and direction in performing\nthe job, both under his or her contract and in fact;\n (b) the service must be performed outside the usual course of business\nfor which the service is performed; and\n (c) the individual is customarily engaged in an independently\nestablished trade, occupation, profession, or business that is similar\nto the service at issue.\n 2. A business entity, including any sole proprietor, partnership,\ncorporation or entity that may be a contractor under this section shall\nbe considered a separate business entity from the contractor where all\nthe following criteria are met:\n (a) the business entity is performing the service free from the\ndirection or control over the means and manner of providing the service,\nsubject only to the right of the contractor for whom the service is\nprovided to specify the desired result;\n (b) the business entity is not subject to cancellation or destruction\nupon severance of the relationship with the contractor;\n (c) the business entity has a substantial investment of capital in the\nbusiness entity beyond ordinary tools and equipment and a personal\nvehicle;\n (d) the business entity owns the capital goods and gains the profits\nand bears the losses of the business entity;\n (e) the business entity makes its services available to the general\npublic or the business community on a continuing basis;\n (f) the business entity includes services rendered on a Federal Income\nTax Schedule as an independent business or profession;\n (g) the business entity performs services for the contractor under the\nbusiness entity's name;\n (h) when the services being provided require a license or permit, the\nbusiness entity obtains and pays for the license or permit in the\nbusiness entity's name;\n (i) the business entity furnishes the tools and equipment necessary to\nprovide the service;\n (j) if necessary, the business entity hires its own employees without\ncontractor approval, pays the employees without reimbursement from the\ncontractor and reports the employees' income to the Internal Revenue\nService;\n (k) the contractor does not represent the business entity as an\nemployee of the contractor to its customers; and\n (l) the business entity has the right to perform similar services for\nothers on whatever basis and whenever it chooses.\n 3. The failure to withhold federal or state income taxes or to pay\nunemployment compensation contributions or workers' compensation\npremiums with respect to an individual's wages shall not be considered\nin making a determination under this section, except as set forth in\nparagraph (f) of subdivision two of this section.\n 4. An individual's act of securing workers' compensation insurance\nwith a carrier as a sole proprietor, partnership or otherwise shall not\nbe binding on any determination under this section.\n 5. When a business entity meets the definition of a separate business\nentity pursuant to subdivision two of this section, the separate\nbusiness entity will be considered a contractor subject to all the\nprovisions of this article in regard to the classification of\nindividuals performing services for it.\n