SB 1073
Classifying independent contractors and employees
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Sign in to take action- Introduced
- Passed Senate
- Passed House of Delegates
- To Governor
- Became Law
Bill overview
This bill aims to clarify the distinction between independent contractors and employees in West Virginia, aligning the state’s classifications with those used by the Internal Revenue Service (IRS). It establishes specific criteria for determining independent contractor status, focusing on contractual agreements, business operations, and control over work. The bill seeks to ensure consistent application of worker classification laws across various state programs, including workers’ compensation, unemployment insurance, and wage payment regulations.
Key provisions
- Requires a written contract outlining the principal’s intent for the worker to be an independent contractor.
- Specifies criteria for independent contractor status, including business ownership, control over work, and the ability to hire assistants.
- Mandates that independent contractors pay their own federal and state income taxes.
- Requires independent contractors to file income tax returns as a business or self-employed individual.
- Defines ‘safety improvement’ for the purpose of determining contractor status, excluding control necessary for compliance.
- References IRS Revenue Ruling 87-41 for determining worker classification.
- States that principals retain the freedom to classify workers as employees even if they meet independent contractor criteria.
- Requires the use of IRS Revenue Rulings and Regulations for classification purposes.
Who is affected
- Businesses that utilize independent contractors
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