S T A T E O F N E W Y O R K
2009-2010 Regular Sessions
I N S E N A T E
June 11, 2009
Introduced by Sens. ONORATO, FOLEY, BRESLIN -- read twice and ordered
printed, and when printed to be committed to the Committee on Rules --
recommitted to the Committee on Labor in accordance with Senate Rule
6, sec. 8 -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee
AN ACT to amend the labor law, in relation to enacting the "New York
state construction industry fair play act"; and to amend the workers'
compensation law, the tax law and the state finance law, in relation
to creating the construction industry classification fund
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The labor law is amended by adding a new article 25-B to
read as follows:
THE NEW YORK STATE CONSTRUCTION INDUSTRY FAIR PLAY ACT
SECTION 861. SHORT TITLE.
861-A. LEGISLATIVE FINDINGS AND INTENT.
861-C. PRESUMPTION OF EMPLOYMENT IN THE CONSTRUCTION INDUSTRY.
861-D. NOTICE TO PERSONS RECEIVING REMUNERATION FROM CONTRACTORS
861-E. VIOLATIONS AND PENALTIES.
861-F. ADVISORY COMMITTEE ON EMPLOYMENT CLASSIFICATION.
S 861. SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
THE "NEW YORK STATE CONSTRUCTION INDUSTRY FAIR PLAY ACT".
S 861-A. LEGISLATIVE FINDINGS AND INTENT. THE LEGISLATURE HEREBY FINDS
AND DECLARES THAT NEW YORK STATE'S CONSTRUCTION INDUSTRY IS EXPERIENCING
DANGEROUS LEVELS OF EMPLOYEE MISCLASSIFICATION FRAUD. UNSCRUPULOUS
EMPLOYERS ARE INTENTIONALLY REPORTING EMPLOYEES AS INDEPENDENT CONTRAC-
TORS TO STATE AND FEDERAL AUTHORITIES OR WORKERS' COMPENSATION CARRIERS
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
S. 5847--A 2
IN RECORD NUMBERS. IN ADDITION, THERE HAS BEEN AN EXPLOSION OF EMPLOYERS
WHO OPERATE IN THE UNDERGROUND ECONOMY AND FAIL TO REPORT ALL OR A SIZA-
BLE PORTION OF THEIR WORKERS.
THE LEGISLATURE HEREBY FINDS AND DECLARES THAT RECENT STUDIES OF NEW
YORK CITY'S CONSTRUCTION INDUSTRY ALONE SUGGESTS THAT AS MANY AS FIFTY
THOUSAND NEW YORK CITY CONSTRUCTION WORKERS -- NEARLY ONE IN FOUR -- ARE
EITHER MISCLASSIFIED AS INDEPENDENT CONTRACTORS OR ARE EMPLOYED BY
CONSTRUCTION CONTRACTORS COMPLETELY OFF THE BOOKS. CONSTRUCTION INDUSTRY
FRAUD REDUCES GOVERNMENT REVENUE, SHIFTS TAX AND WORKERS' COMPENSATION
INSURANCE COSTS TO LAW-ABIDING EMPLOYEES, LOWERS WORKING CONDITIONS AND
STEALS JOBS FROM LEGITIMATE EMPLOYERS AND THEIR EMPLOYEES.
IN TWO THOUSAND FIVE ALONE, IT WAS ESTIMATED THAT THE LOST PAYROLL
TAXES AND SOCIAL INSURANCE PREMIUM PAYMENTS IN NEW YORK CITY DUE TO
CLASSIFICATION FRAUD EXCEEDED TWO HUNDRED SEVENTY MILLION DOLLARS. IN
ADDITION THE GOVERNMENT AND PROVIDERS WERE FORCED TO PAY AN ADDITIONAL
ONE HUNDRED FORTY-EIGHT MILLION DOLLARS FOR HEALTH CARE COSTS FRAUDU-
LENTLY SHIFTED FROM EMPLOYERS. FINALLY, IT WAS ESTIMATED THAT THE
GOVERNMENT WAS CHEATED OUT OF ALMOST SEVENTY MILLION DOLLARS IN LOST
INCOME TAXES DUE. MISCLASSIFICATION FRAUD CREATES SIGNIFICANT PROBLEMS
FOR WORKERS. THESE WORKERS ARE NOT COVERED BY WORKERS' COMPENSATION,
UNEMPLOYMENT INSURANCE, OR TEMPORARY DISABILITY. THEY ARE LIABLE FOR
TAXES THEY DO NOT OWE AND LOSE OVERTIME AND HEALTH BENEFITS. FINALLY,
UNSCRUPULOUS CONTRACTORS WHO ENGAGE IN FRAUD ARE ABLE TO UNDERCUT LAW-A-
BIDING CONTRACTORS BY AS MUCH AS THIRTY PERCENT IN THE PRICE OF
THEREFORE, THE LEGISLATURE HEREBY FINDS AND DECLARES THAT GOVERNMENT
HAS AN OBLIGATION TO CURB THIS UNDERGROUND ECONOMY, ENFORCE LONG-STAND-
ING EMPLOYMENT LAWS, ENSURE COMPLIANCE WITH ESSENTIAL SOCIAL INSURANCE
PROTECTIONS AND ELIMINATE THE UNFAIR COMPETITIVE ADVANTAGE FROM CONTRAC-
TORS IN THE UNDERGROUND ECONOMY BY AND THROUGH THE ENACTMENT OF THE NEW
YORK STATE CONSTRUCTION INDUSTRY FAIR PLAY ACT.
S 861-B. DEFINITIONS. AS USED IN THIS ARTICLE:
1. "CONSTRUCTION" MEANS CONSTRUCTING, RECONSTRUCTING, ALTERING, MAIN-
TAINING, MOVING, REHABILITATING, REPAIRING, RENOVATING OR DEMOLITION OF
ANY BUILDING, STRUCTURE, OR IMPROVEMENT, OR RELATING TO THE EXCAVATION
OF OR OTHER DEVELOPMENT OR IMPROVEMENT TO LAND.
2. "CONTRACTOR" MEANS ANY SOLE PROPRIETOR, PARTNERSHIP, FIRM, CORPO-
RATION, LIMITED LIABILITY COMPANY, ASSOCIATION OR OTHER LEGAL ENTITY
PERMITTED BY LAW TO DO BUSINESS WITHIN THE STATE OF NEW YORK WHO ENGAGES
IN CONSTRUCTION AS DEFINED IN THIS ARTICLE.
3. "CONTRACTOR" INCLUDES A GENERAL CONTRACTOR AND A SUBCONTRACTOR.
4. "DEPARTMENT" MEANS THE DEPARTMENT OF LABOR.
5. "COMMISSIONER" MEANS THE COMMISSIONER OF LABOR.
6. "EMPLOYER" MEANS ANY CONTRACTOR THAT EMPLOYS AN INDIVIDUAL CLASSI-
FIED AS AN EMPLOYEE UNDER THIS ARTICLE.
S 861-C. PRESUMPTION OF EMPLOYMENT IN THE CONSTRUCTION INDUSTRY. 1.
ANY PERSON PERFORMING SERVICES FOR A CONTRACTOR SHALL BE CLASSIFIED AS
AN EMPLOYEE UNLESS ALL OF THE FOLLOWING CRITERIA ARE MET:
(A) THE INDIVIDUAL IS FREE FROM CONTROL AND DIRECTION IN PERFORMING
THE JOB, BOTH UNDER HIS OR HER CONTRACT AND IN FACT;
(B) THE SERVICE MUST BE PERFORMED OUTSIDE THE CONTRACTOR'S USUAL
COURSE OF BUSINESS; AND
(C) THE INDIVIDUAL MUST BE CUSTOMARILY ENGAGED IN AN INDEPENDENTLY
ESTABLISHED TRADE, OCCUPATION, PROFESSION, OR BUSINESS THAT IS SIMILAR
TO THE SERVICE AT ISSUE.
S. 5847--A 3
2. THE FAILURE TO WITHHOLD FEDERAL OR STATE INCOME TAXES OR TO PAY
UNEMPLOYMENT COMPENSATION CONTRIBUTIONS OR WORKERS' COMPENSATION PREMI-
UMS WITH RESPECT TO AN INDIVIDUAL'S WAGES SHALL NOT BE CONSIDERED IN
MAKING A DETERMINATION UNDER THIS SECTION.
3. AN INDIVIDUAL'S ACT OF SECURING WORKERS' COMPENSATION INSURANCE
WITH A CARRIER AS A SOLE PROPRIETOR OR PARTNERSHIP SHALL NOT BE CONSID-
ERED IN MAKING A DETERMINATION UNDER THIS SECTION.
S 861-D. NOTICE TO PERSONS RECEIVING REMUNERATION FROM CONTRACTORS AND
SUBCONTRACTORS. 1. CONTRACTORS SHALL PROVIDE TO ALL INDIVIDUALS RECEIV-
ING REMUNERATION TO PERFORM CONSTRUCTION WORK A WRITTEN NOTICE, PROVIDED
BY THE COMMISSIONER, THAT DESCRIBES THE RESPONSIBILITY OF INDEPENDENT
CONTRACTORS TO PAY TAXES REQUIRED BY STATE AND FEDERAL LAW AND THE
RIGHTS OF EMPLOYEES TO WORKERS' COMPENSATION, UNEMPLOYMENT BENEFITS,
MINIMUM WAGE, OVERTIME AND OTHER FEDERAL AND STATE WORKPLACE
PROTECTIONS. SUCH INFORMATION SHALL ALSO CONTAIN CONTACT INFORMATION FOR
SUCH PERSONS TO FILE COMPLAINTS OR INQUIRE WITH THE COMMISSIONER ABOUT
EMPLOYMENT CLASSIFICATION STATUS. IN ADDITION, THE NOTICE SHALL CONTAIN
THE ADDRESS TO THE WEB SITE DESCRIBED IN SUBDIVISION THREE OF THIS
SECTION, THE PROTECTIONS AGAINST RETALIATION IN THIS ARTICLE AND THE
PENALTIES IN THIS ARTICLE IF THE CONTRACTOR HAS FAILED TO PROPERLY CLAS-
SIFY THE PERSON AS AN EMPLOYEE.
2. THE INFORMATION IN SUBDIVISION ONE OF THIS SECTION SHALL BE
PROVIDED IN SPANISH OR OTHER LANGUAGES REQUIRED BY THE COMMISSIONER.
3. WITHIN SIX MONTHS OF THE EFFECTIVE DATE OF THIS ARTICLE, THE
COMMISSIONER SHALL CREATE THE NOTICE DESCRIBED IN SUBDIVISION ONE OF
THIS SECTION. IN ADDITION, WITHIN THE SAME TIME PERIOD, THE COMMISSIONER
SHALL CREATE A WEB SITE THAT CONTAINS THE SAME INFORMATION AND THE
NOTICE. SUCH NOTICE SHALL BE PROVIDED TO CONTRACTORS THROUGH DOWNLOADING
FROM THE WEB SITE.
4. CONTRACTORS IN THEIR AGREEMENTS WITH ALL SUBCONTRACTORS SHALL
REQUIRE THEM TO:
(A) PROVIDE THE NOTICE DESCRIBED IN THIS SECTION, AND
(B) PLACE THE NOTICE REQUIREMENT IN CONTRACTS WITH ANY LOWER TIER
5. CONTRACTORS WHO VIOLATE THIS SECTION SHALL BE SUBJECT TO THE
FOLLOWING CIVIL PENALTIES:
(A) TWO THOUSAND DOLLARS PER INDIVIDUAL WHO IS NOT NOTIFIED; AND
(B) FIVE THOUSAND DOLLARS PER CONTRACT WITH A SUBCONTRACTOR OR LOWER
TIER SUBCONTRACTOR THAT DOES NOT CONTAIN THE NOTICE REQUIREMENT.
S 861-E. VIOLATION AND PENALTIES. 1. ANY CONTRACTOR WHO FAILS TO PROP-
ERLY CLASSIFY AN INDIVIDUAL AS AN EMPLOYEE AS PROVIDED UNDER SECTION
EIGHT HUNDRED SIXTY-ONE-C OF THIS ARTICLE SHALL BE SUBJECT TO THE CIVIL
AND CRIMINAL PENALTIES PROVIDED UNDER THIS SECTION.
2. FOR THE PURPOSES OF THIS SECTION, THE TERM "WILLFULLY VIOLATES"
MEANS A CONTRACTOR KNEW OR SHOULD HAVE KNOWN THAT HIS OR HER CONDUCT WAS
PROHIBITED BY THIS SECTION.
3. ANY CONTRACTOR WHO WILLFULLY VIOLATES SECTION EIGHT HUNDRED SIXTY-
ONE-C OF THIS ARTICLE SHALL BE SUBJECT TO A CIVIL PENALTY OF UP TO TWEN-
TY-FIVE HUNDRED DOLLARS FOR THE FIRST VIOLATION PER EMPLOYEE, AND TO A
CIVIL PENALTY OF UP TO FIVE THOUSAND DOLLARS FOR EACH SUBSEQUENT
VIOLATION PER EMPLOYEE.
4. IF THE CONTRACTOR IS A CORPORATION, ANY OFFICER OF SUCH CORPORATION
OR SHAREHOLDER WHO OWNS OR CONTROLS AT LEAST TEN PERCENT OF THE
OUTSTANDING STOCK OF SUCH CORPORATION WHO KNOWINGLY PERMITS THE CORPO-
RATION TO WILLFULLY VIOLATE ANY PROVISION OF THIS ARTICLE SHALL BE
S. 5847--A 4
SUBJECT TO THE SAME CIVIL PENALTY PROVIDED UNDER THIS ARTICLE FOR A
VIOLATION OF SUCH PROVISION.
5. IF ANY CONTRACTOR WILLFULLY VIOLATES SECTION EIGHT HUNDRED
SIXTY-ONE-C OF THIS ARTICLE AND SUCH VIOLATION RESULTS IN A FAILURE BY
THE CONTRACTOR TO PAY UNEMPLOYMENT INSURANCE TAX, WORKERS' COMPENSATION,
OR CORPORATE OR PERSONAL INCOME TAX FOR THE MISCLASSIFICATION OF AN
EMPLOYEE, THE CONTRACTOR SHALL BE SUBJECT, AT THE DISCRETION OF THE
COMMISSIONER, TO ADDITIONAL CIVIL PENALTIES AS FOLLOWS:
(A) FOR FAILURE TO PAY UNEMPLOYMENT INSURANCE TAX, THE PENALTIES
IMPOSED BY SECTION FIVE HUNDRED SEVENTY OF THIS CHAPTER,
(B) FOR FAILURE TO PAY WORKERS' COMPENSATION INSURANCE, THE PENALTIES
IMPOSED BY SECTION TWENTY-FIVE AND TWO HUNDRED TWENTY OF THE WORKERS'
COMPENSATION LAW, AND
(C) FOR FAILURE TO PAY CORPORATE OR PERSONAL INCOME TAX, THE PENALTIES
IMPOSED BY SECTIONS SIX HUNDRED EIGHTY-FIVE AND ONE THOUSAND EIGHTY-FIVE
OF THE TAX LAW.
6. IN ADDITION TO ANY CIVIL PENALTIES IMPOSED UNDER THIS ARTICLE, A
CONTRACTOR WHO WILLFULLY VIOLATES SECTION EIGHT HUNDRED SIXTY-ONE-C OF
THIS ARTICLE SHALL BE GUILTY OF A MISDEMEANOR AND UPON CONVICTION, SHALL
BE PUNISHED FOR A FIRST OFFENSE BY IMPRISONMENT FOR NOT MORE THAN THIRTY
DAYS AND FOR A SUBSEQUENT OFFENSE, BY IMPRISONMENT FOR NOT MORE THAN
7. ANY CONTRACTOR WHO HAS BEEN CONVICTED OF A MISDEMEANOR OR AGAINST
WHOM A FINAL CIVIL DETERMINATION HAS BEEN RENDERED FOR A WILLFUL
VIOLATION OF SECTION EIGHT HUNDRED SIXTY-ONE-C OF THIS ARTICLE SHALL BE
INELIGIBLE TO SUBMIT A BID ON OR BE AWARDED ANY PUBLIC CONTRACT WITH THE
STATE, ANY MUNICIPAL CORPORATION, PUBLIC BENEFIT CORPORATION OR PUBLIC
BODY FOR A PERIOD OF UP TO FIVE YEARS FROM THE DATE OF SUCH CONVICTION
OR FINAL DETERMINATION.
8. ANY EMPLOYEE AGGRIEVED BY A VIOLATION OF THIS ARTICLE, OR AN ORGAN-
IZATION REPRESENTING AN AGGRIEVED EMPLOYEE, MAY FILE A CIVIL ACTION TO
RECOVER LOST WAGES, TREBLE DAMAGES, ATTORNEY'S FEES AND COSTS WITHIN
THREE YEARS FROM THE DATE OF SUCH VIOLATION.
9. A PENALTY IMPOSED UNDER THIS SECTION AGAINST A CONSTRUCTION INDUS-
TRY EMPLOYER SHALL BE IN EFFECT AGAINST ANY SUCCESSOR CORPORATION OR
BUSINESS ENTITY THAT HAS ONE OR MORE OF THE SAME PRINCIPALS OR OFFICERS
AS THE EMPLOYER AGAINST WHOM THE PENALTY WAS IMPOSED.
10. NOTHING IN THIS SECTION SHALL LIMIT THE AVAILABILITY OF OTHER
REMEDIES AT LAW OR IN EQUITY FOR A VIOLATION OF THIS ARTICLE.
S 861-F. ADVISORY COMMITTEE ON EMPLOYMENT CLASSIFICATION. 1. THERE IS
HEREBY ESTABLISHED THE ADVISORY COMMITTEE ON EMPLOYMENT CLASSIFICATION.
THE PURPOSE OF SUCH ADVISORY COMMITTEE IS TO DEVELOP RECOMMENDATIONS FOR
A COMPREHENSIVE AND STRATEGIC STATEWIDE APPROACH TO ADDRESSING THE PROB-
LEM OF EMPLOYEE MISCLASSIFICATION AND TO ENSURE CONTRACTOR COMPLIANCE
WITH THE "NEW YORK STATE CONSTRUCTION INDUSTRY FAIR PLAY ACT".
2. THE ADVISORY COMMITTEE SHALL BE COMPOSED OF THE COMMISSIONER OR A
DESIGNEE; THE ATTORNEY GENERAL OR A DESIGNEE; THE COMMISSIONER OF TAXA-
TION AND FINANCE OR A DESIGNEE; THE CHAIR OF THE WORKERS' COMPENSATION
BOARD OR A DESIGNEE; THIRTEEN MEMBERS WHO SHALL BE APPOINTED BY THE
GOVERNOR AND SHALL SERVE AT HIS PLEASURE AS FOLLOWS: THREE REPRESEN-
TATIVES FROM THREE DIFFERENT BUILDING TRADE UNIONS; THREE REPRESEN-
TATIVES OF THE NEW YORK STATE AMERICAN FEDERATION OF LABOR-CONGRESS OF
INDUSTRIAL ORGANIZATIONS; THREE REPRESENTATIVES OF THE BUSINESS COMMUNI-
TY; ONE REPRESENTATIVE OF RESIDENTIAL DEVELOPERS; ONE REPRESENTATIVE OF
RESIDENTIAL CONSTRUCTION CONTRACTORS; ONE REPRESENTATIVE OF COMMERCIAL
S. 5847--A 5
DEVELOPERS; AND ONE REPRESENTATIVE OF COMMERCIAL CONSTRUCTION CONTRAC-
3. THE COMMISSIONER SHALL SERVE AS THE CHAIR OF THE ADVISORY COMMIT-
TEE. ALL PUBLIC MEMBERS OF THE ADVISORY COMMITTEE SHALL SERVE WITHOUT
COMPENSATION. VACANCIES ON THE ADVISORY COMMITTEE SHALL BE FILLED IN THE
SAME MANNER AS THE ORIGINAL APPOINTMENT.
4. THE ADVISORY COMMITTEE SHALL BE AUTHORIZED TO:
(A) MAKE RECOMMENDATIONS TO THE DEPARTMENT, THE ATTORNEY GENERAL, THE
DEPARTMENT OF TAXATION AND FINANCE AND THE WORKERS' COMPENSATION BOARD
WITH RESPECT TO SYNCHRONIZING EACH RESPECTIVE DEPARTMENT'S REGULATIONS
AND POLICIES REGARDING EMPLOYEE MISCLASSIFICATION;
(B) MAKE RECOMMENDATIONS TO ENHANCE MECHANISMS FOR IDENTIFYING EMPLOY-
EE MISCLASSIFICATION WHERE IT DOES OCCUR; AND
(C) WORK WITH BUSINESS, LABOR AND COMMUNITY GROUPS TO DEVELOP EDUCA-
TIONAL MATERIALS THAT DISTINGUISH THE DIFFERENCE BETWEEN AN INDEPENDENT
CONTRACTOR AND AN EMPLOYEE.
5. THE ADVISORY COMMITTEE SHALL ISSUE A REPORT ANNUALLY TO THE GOVER-
NOR AND LEGISLATURE ON THE STATUS OF IMPLEMENTATION OF THE NEW YORK
STATE CONSTRUCTION INDUSTRY FAIR PLAY ACT, TO INCLUDE PUBLICLY AVAILABLE
INFORMATION REGARDING: CASES BROUGHT, WAGES AND TAXES RECOVERED ON
BEHALF OF THE STATE, OUTCOMES OF CASES, LEGAL OR ADMINISTRATIVE BARRIERS
TO SUCCESSFUL IMPLEMENTATION, A REVIEW OF THE PROCESS USED TO ADJUDICATE
MISCLASSIFICATION CASES, AND PROPOSALS FOR ANY ADDITIONAL LEGISLATIVE
ACTION THAT MAY BE NEEDED TO ENHANCE THE STATE'S EFFORTS TO ADDRESS
EMPLOYEE MISCLASSIFICATION IN THE CONSTRUCTION INDUSTRY IN THE STATE.
6. THE ADVISORY COMMITTEE MAY REQUEST ANY DEPARTMENT, OFFICE, DIVISION
OR AGENCY OF THE STATE TO PROVIDE DATA AND OTHER INFORMATION, PERSONNEL
OR ASSISTANCE AVAILABLE TO SUCH AGENCY AS THE ADVISORY COMMITTEE DEEMS
NECESSARY TO DISCHARGE ITS DUTIES UNDER THIS ARTICLE SUBJECT TO CONFI-
DENTIALITY PROVISIONS UNDER LAW. EACH DEPARTMENT, OFFICE, DIVISION OR
AGENCY OF THE STATE SHALL, TO THE EXTENT NOT INCONSISTENT WITH LAW,
COOPERATE FULLY WITH THE ADVISORY COMMITTEE AND FURNISH SUCH ASSISTANCE
ON AS TIMELY A BASIS AS IS NECESSARY TO ACCOMPLISH THE PURPOSES OF THIS
ARTICLE. THE ADVISORY COMMITTEE MAY CONSULT WITH EXPERTS OR OTHER KNOW-
LEDGEABLE INDIVIDUALS IN THE PUBLIC OR PRIVATE SECTOR IN CARRYING OUT
ITS PURPOSE AND DUTIES.
S 861-G. RETALIATION. 1. IT IS A VIOLATION OF THIS ARTICLE FOR AN
EMPLOYER OR ANY AGENT OF AN EMPLOYER, TO RETALIATE THROUGH DISCHARGE OR
IN ANY OTHER MANNER AGAINST ANY PERSON IN THE TERMS AND CONDITIONS OF
HIS OR HER EMPLOYMENT FOR EXERCISING ANY RIGHTS GRANTED UNDER THIS ARTI-
(A) MAKING A COMPLAINT TO AN EMPLOYER, CO-WORKER OR TO A PUBLIC BODY
THAT RIGHTS GUARANTEED UNDER THIS ARTICLE HAVE BEEN VIOLATED;
(B) CAUSING TO BE INSTITUTED ANY PROCEEDING UNDER OR RELATED TO THIS
(C) PROVIDING INFORMATION TO, OR TESTIFYING BEFORE, ANY PUBLIC BODY
CONDUCTING AN INVESTIGATION, HEARING OR INQUIRY INTO ANY SUCH VIOLATION
OF A LAW, RULE OR REGULATION BY SUCH EMPLOYER.
2. ANY ACT OF RETALIATION UNDER THIS SECTION SHALL SUBJECT AN EMPLOYER
TO THE CIVIL PENALTIES UNDER SECTION EIGHT HUNDRED SIXTY-ONE-E OF THIS
ARTICLE, OR TO A PRIVATE CAUSE OF ACTION, OR BOTH.
S 2. Paragraph (b) of subdivision 1 of section 511 of the labor law is
amended by adding a new subparagraph 1-b to read as follows:
(1-B) AS AN EMPLOYEE IN THE CONSTRUCTION INDUSTRY UNLESS THE PRESUMP-
TION OF EMPLOYMENT CAN BE OVERCOME, AS PROVIDED UNDER SECTION EIGHT
HUNDRED SIXTY-ONE-C OF THIS CHAPTER,
S. 5847--A 6
S 3. The opening paragraph of subdivision 4 of section 2 of the work-
ers' compensation law, as amended by chapter 205 of the laws of 1993, is
amended to read as follows:
"Employee" means a person engaged in one of the occupations enumerated
in section three or who is in the service of an employer whose principal
business is that of carrying on or conducting a hazardous employment
upon the premises or at the plant, or in the course of his employment
away from the plant of his employer; "EMPLOYEE" SHALL ALSO MEAN FOR THE
PURPOSES OF THIS CHAPTER ANY INDIVIDUAL PERFORMING SERVICES FOR A
CONTRACTOR WHO DOES NOT OVERCOME THE PRESUMPTION OF EMPLOYMENT AS
PROVIDED UNDER SECTION EIGHT HUNDRED SIXTY-ONE-C OF THE LABOR LAW;
"employee" shall also mean for the purposes of this chapter civil
defense volunteers who are personnel of volunteer agencies sponsored or
authorized by a local office under regulations of the civil defense
commission, to the extent of the provisions of groups seventeen and
nineteen; "employee" shall at the election of a municipal corporation
made pursuant to local law duly enacted also mean a member of an auxil-
iary police organization authorized by local law; and for the purposes
of this chapter only a newspaper carrier under the age of eighteen years
as defined in section thirty-two hundred twenty-eight of the education
law, and shall not include domestic servants except as provided in
section three of this chapter, and except where the employer has elected
to bring such employees under the law by securing compensation in
accordance with the terms of section fifty of this chapter. The term
"employee" shall not include persons who are members of a supervised
amateur athletic activity operated on a non-profit basis, provided that
said members are not also otherwise engaged or employed by any person,
firm or corporation participating in said athletic activity, nor shall
it include the spouse or minor child of an employer who is a farmer
unless the services of such spouse or minor child shall be engaged by
said employer under an express contract of hire nor shall it include an
executive officer of a corporation who at all times during the period
involved owns all of the issued and outstanding stock of the corporation
and holds all of the offices pursuant to paragraph (e) of section seven
hundred fifteen of the business corporation law or two executive offi-
cers of a corporation who at all times during the period involved
between them own all of the issued and outstanding stock of such corpo-
ration and hold all such offices except as provided in subdivision six
of section fifty-four of this chapter provided, however, that where
there are two executive officers of a corporation each officer must own
at least one share of stock, nor shall it include a self-employed person
or a partner of a partnership as defined in section ten of the partner-
ship law who is not covered under a compensation insurance contract or a
certificate of self-insurance as provided in subdivision eight of
section fifty-four of this chapter, nor shall it include farm laborers
except as provided in group fourteen-b of section three of this chapter.
If a farm labor contractor recruits or supplies farm laborers for work
on a farm, such farm laborers shall for the purposes of this chapter be
deemed to be employees of the owner or lessee of such farm. The term
"employee" shall not include baby sitters as defined in subdivision
three of section one hundred thirty-one and subdivision three of section
one hundred thirty-two of the labor law or minors fourteen years of age
or over engaged in casual employment consisting of yard work and house-
hold chores in and about a one family owner-occupied residence or the
premises of a non-profit, non-commercial organization, not involving the
use of power-driven machinery. The term "employee" shall not include
S. 5847--A 7
persons engaged by the owner in casual employment consisting of yard
work, household chores and making repairs to or painting in and about a
one-family owner-occupied residence. The term "employee" shall not
include the services of a licensed real estate broker or sales associate
if it be proven that (a) substantially all of the remuneration (whether
or not paid in cash) for the services performed by such broker or sales
associate is directly related to sales or other output (including the
performance of services) rather than to the number of hours worked; (b)
the services performed by the broker or sales associate are performed
pursuant to a written contract executed between such broker or sales
associate and the person for whom the services are performed within the
past twelve to fifteen months; and (c) the written contract provided for
in paragraph (b) herein was not executed under duress and contains the
S 4. Paragraph 1 of subsection (a) of section 671 of the tax law, as
amended by chapter 760 of the laws of 1992, is amended to read as
(1) Every employer maintaining an office or transacting business with-
in this state and making payment of any wages taxable under this
article, INCLUDING AN EMPLOYER AS DEFINED IN SUBDIVISION SIX OF SECTION
EIGHT HUNDRED SIXTY-ONE-B OF THE LABOR LAW, shall deduct and withhold
from such wages for each payroll period a tax computed in such manner as
to result, so far as practicable, in withholding from the employee's
wages during each calendar year an amount substantially equivalent to
the tax reasonably estimated to be due under this article resulting from
the inclusion in the employee's New York adjusted gross income or New
York source income of his wages received during such calendar year. The
method of determining the amount to be withheld shall be prescribed by
regulations of the commissioner, with due regard to the New York with-
holding exemptions of the employee and the sum of any credits allowable
against his tax.
S 5. The state finance law is amended by adding a new section 99-t to
read as follows:
S 99-T. CONSTRUCTION INDUSTRY CLASSIFICATION FUND. 1. THERE IS HEREBY
ESTABLISHED IN THE JOINT CUSTODY OF THE STATE COMPTROLLER AND THE
COMMISSIONER OF TAXATION AND FINANCE AN ACCOUNT IN THE MISCELLANEOUS
SPECIAL REVENUE FUND TO BE KNOWN AS THE "CONSTRUCTION INDUSTRY CLASSI-
2. THE CONSTRUCTION INDUSTRY CLASSIFICATION FUND SHALL CONSIST OF ALL
MONEYS RECEIVED BY THE STATE AS FEES AND CIVIL PENALTIES PURSUANT TO
ARTICLE TWENTY-FIVE-B OF THE LABOR LAW.
3. SUCH FUND SHALL BE SUBJECT TO APPROPRIATION BY THE DEPARTMENT OF
LABOR FOR ADMINISTRATION, INVESTIGATION AND OTHER EXPENSES INCURRED IN
CARRYING OUT ITS POWERS AND DUTIES PURSUANT TO ARTICLE TWENTY-FIVE-B OF
THE LABOR LAW AND THE DEPARTMENT MAY HIRE AS MANY INVESTIGATORS AND
OTHER PERSONNEL AS MAY BE NECESSARY TO CARRY OUT SUCH DUTIES. ANY MONEYS
IN THE FUND AT THE END OF THE FISCAL YEAR IN EXCESS OF ANY MONEYS NECES-
SARY FOR THE DEPARTMENT OF LABOR TO CARRY OUT ITS POWERS AND DUTIES
UNDER ARTICLE TWENTY-FIVE-B SHALL BE AVAILABLE TO THE DEPARTMENT OF
LABOR FOR THE NEXT FISCAL YEAR FOR ANY OF THE DEPARTMENT OF LABOR'S
DUTIES UNDER ARTICLE TWENTY-FIVE-B OF THE LABOR LAW.
S 6. This act shall take effect on the sixtieth day after it shall
have become a law.