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AB-2373 Independent contractor: definition.(2011-2012)

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AB2373:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2011–2012 REGULAR SESSION

Assembly Bill
No. 2373


Introduced  by  Assembly Member Norby

February 24, 2012


An act to add Section 22.5 to the Business and Professions Code, to add Section 22.5 to the Civil Code, to add Section 32.7 to the Code of Civil Procedure, to amend Section 3405 of the Commercial Code, to add Section 22 to the Corporations Code, to add Section 91 to the Education Code, to add Section 23 to the Financial Code, to add Section 34 to the Food and Agricultural Code, to add Section 27 to the Government Code, to add Section 26 to the Harbors and Navigation Code, to add Section 29 to the Health and Safety Code, to add Section 49 to the Insurance Code, to add Section 30 to, and to repeal Section 3353 of, the Labor Code, to amend Section 395.10 of the Military and Veterans Code, to add Section 7.2 to the Penal Code, to add Section 1102.5 to the Public Contract Code, to amend Section 6217.1 of the Public Resources Code, to add Section 20.2 to the Public Utilities Code, to add Section 23.5 to the Revenue and Taxation Code, to add Section 17.5 to the Unemployment Insurance Code, to add Section 364 to the Vehicle Code, to add Section 27 to the Water Code, and to add Section 28 to the Welfare and Institutions Code, relating to independent contractors.


LEGISLATIVE COUNSEL'S DIGEST


AB 2373, as introduced, Norby. Independent contractor: definition.
Existing law defines “independent contractor” for purposes of the Labor Code to mean a person who renders service for a specified recompense for a specified result under the control of his or her principal as to the result of his or her work only and not as to the means by which this result is accomplished.
This bill would amend that definition to state that whether a person is an independent contractor is determined by considering various factors, as specified. The bill would amend various other statutory codes to incorporate this definition of independent contractor.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 22.5 is added to the Business and Professions Code, to read:

22.5.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 2.

 Section 22.5 is added to the Civil Code, to read:

22.5.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 3.

 Section 32.7 is added to the Code of Civil Procedure, to read:

32.7.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 4.

 Section 3405 of the Commercial Code is amended to read:

3405.
 (a) In this section:
(1) “Employee” includes an independent contractor, as defined in Section 30 of the Labor Code, and employee of an independent contractor retained by the employer.
(2) “Fraudulent indorsement” means (A) in the case of an instrument payable to the employer, a forged indorsement purporting to be that of the employer, or (B) in the case of an instrument with respect to which the employer is the issuer, a forged indorsement purporting to be that of the person identified as payee.
(3) “Responsibility” with respect to instruments means authority (A) to sign or indorse instruments on behalf of the employer, (B) to process instruments received by the employer for bookkeeping purposes, for deposit to an account, or for other disposition, (C) to prepare or process instruments for issue in the name of the employer, (D) to supply information determining the names or addresses of payees of instruments to be issued in the name of the employer, (E) to control the disposition of instruments to be issued in the name of the employer, or (F) to act otherwise with respect to instruments in a responsible capacity. “Responsibility” does not include authority that merely allows an employee to have access to instruments or blank or incomplete instrument forms that are being stored or transported or are part of incoming or outgoing mail, or similar access.
(b) For the purpose of determining the rights and liabilities of a person who, in good faith, pays an instrument or takes it for value or for collection, if an employer entrusted an employee with responsibility with respect to the instrument and the employee or a person acting in concert with the employee makes a fraudulent indorsement of the instrument, the indorsement is effective as the indorsement of the person to whom the instrument is payable if it is made in the name of that person. If the person paying the instrument or taking it for value or for collection fails to exercise ordinary care in paying or taking the instrument and that failure contributes to loss resulting from the fraud, the person bearing the loss may recover from the person failing to exercise ordinary care to the extent the failure to exercise ordinary care contributed to the loss.
(c) Under subdivision (b), an indorsement is made in the name of the person to whom an instrument is payable if (1) it is made in a name substantially similar to the name of that person or (2) the instrument, whether or not indorsed, is deposited in a depositary bank to an account in a name substantially similar to the name of that person.

SEC. 5.

 Section 22 is added to the Corporations Code, to read:

22.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 6.

 Section 91 is added to the Education Code, to read:

91.
 “Independent contractor” whenever used in this code has the same meaning as defined in Section 30 of the Labor Code.

SEC. 7.

 Section 23 is added to the Financial Code, to read:

23.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 8.

 Section 34 is added to the Food and Agricultural Code, to read:

34.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 9.

 Section 27 is added to the Government Code, to read:

27.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 10.

 Section 26 is added to the Harbors and Navigation Code, to read:

26.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 11.

 Section 29 is added to the Health and Safety Code, to read:

29.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 12.

 Section 49 is added to the Insurance Code, to read:

49.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 13.

 Section 30 is added to the Labor Code, to read:

30.
 “Independent contractor” means a person who renders service for a specified recompense for a specified result, under the control of his or her principal as to the result of his or her work only and not as to the means by which such result is accomplished. Factors to be considered in determining whether a person is an independent contractor include the following:
(a) The extent to which the principal controls and directs the manner and means of rendering the service.
(b) The extent to which the principal provides training to the person rendering the service.
(c) Whether the service rendered is integrated into the principal’s business operations.
(d) The method by which the principal provides recompense.
(e) Whether a continuing relationship exists between the principal and person rendering the service.
(f) Whether the principal established the hours of work of the person rendering the service.
(g) The amount of time required for the person to rendered the service.
(h) Whether the principal or person rendering the service provides the instrumentalities and facilities necessary for rendering the service.
(i) The extend to which the person rendering the service is required to report to the principal.
(j) The extent to which the person rendering the service has unreimbursed business expenses or investments in the business of the principal.
(k) Whether the person rendering the service is engaged in a separate occupation or business or makes his or her service available to the general public.
(l) Whether this kind of service is usually rendered under the direction of the principal without supervision.
(m) Whether the parties believe they are establishing an employer-employee relationship.
(n) The length of time for rendering the service.
(o) The extent to which the service pertains to the regular business of the principal.
(p) The skill required to render the service.
(q) Whether the principal or person rendering the service have a right to terminate their relationship.

SEC. 14.

 Section 3353 of the Labor Code is repealed.
3353.

“Independent contractor” means any person who renders service for a specified recompense for a specified result, under the control of his principal as to the result of his work only and not as to the means by which such result is accomplished.

SEC. 15.

 Section 395.10 of the Military and Veterans Code is amended to read:

395.10.
 (a) Notwithstanding any other provision of law, a qualified employer shall allow a qualified employee to take up to 10 days of unpaid leave during a qualified leave period.
(b) For purposes of this section:
(1) “Period of military conflict” means either of the following:
(A) A period of war declared by the United States Congress.
(B) A period of deployment for which a member of a reserve component is ordered to active duty pursuant to either of the following:
(i) Sections 12301 and 12302 of Title 10 of the United States Code.
(ii) Title 32 of the United States Code.
(2) “Qualified employee” means a person who satisfies all of the following:
(A) Is the spouse of a qualified member.
(B) Performs service for hire for an employer for an average of 20 or more hours per week, but does not include an independent contractor, as that term is defined in Section 30 of the Labor Code.
(C) Provides the qualified employer with notice, within two business days of receiving official notice that the qualified member will be on leave from deployment, of his or her intention to take the leave provided for in subdivision (a).
(D) Submits written documentation to the qualified employer certifying that the qualified member will be on leave from deployment during the time the leave provided for in subdivision (a) is requested.
(3) “Qualified employer” includes any individual, corporation, company, firm, state, city, county, city and county, municipal corporation, district, public authority, or any other governmental subdivision, that employs 25 or more employees.
(4) “Qualified member” means a person who is any of the following:
(A) A member of the Armed Forces of the United States who has been deployed during a period of military conflict to an area designated as a combat theater or combat zone by the President of the United States.
(B) A member of the National Guard who has been deployed during a period of military conflict.
(C) A member of the Reserves who has been deployed during a period of military conflict.
(5) “Qualified leave period” means the period during which the qualified member is on leave from deployment during a period of military conflict.
(c) A qualified employer shall not retaliate against a qualified employee for requesting or taking the leave provided for in this section.
(d) The leave provided for in this section shall not affect or prevent a qualified employer from allowing a qualified employee to take a leave that the qualified employee is otherwise entitled to take.
(e) This section shall not affect a qualified employee’s rights with respect to any other employee benefit provided for in other laws.

SEC. 16.

 Section 7.2 is added to the Penal Code, to read:

7.2.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 17.

 Section 1102.5 is added to the Public Contract Code, to read:

1102.5.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 18.

 Section 6217.1 of the Public Resources Code is amended to read:

6217.1.
 (a) This section and the process described in this section governs govern the expenditure of any funds received by the State of California from the federal government for the purposes of salmon and steelhead trout conservation and restoration, the expenditure of funds authorized for the Coastal Watershed Salmon Habitat Program pursuant to Article 7 (commencing with Section 79104.200) of Chapter 6 of Division 26 of the Water Code, and the expenditure of funds appropriated to the Department of Fish and Game for salmon and steelhead trout conservation and restoration from the California Clean Water, Clean Air, Safe Neighborhood Parks, and Coastal Protection Fund pursuant to Article 5 (commencing with Section 5096.650) of Chapter 1.696 of Division 5 of the Public Resources Code.
(b) For purposes of this section, “project” means an activity that improves fish habitat in coastal waters utilized by salmon and anadromous trout species.
(c) (1) The Department of Fish and Game shall grant funds from the Salmon and Steelhead Trout Restoration Account in the Resources Trust Fund, as follows:
(A) At least 87.5 percent of the funds shall be allocated as project grants through the existing grant program operated by the fisheries management program of the Department of Fish and Game.
(B) Not more than 12.5 percent of the funds may also be used for project contract administration activities and biological support staff.
(2) (A) A project shall require the consent of a willing landowner, and emphasize the development of coordinated watershed improvement activities.
(B) Projects that restore habitat for salmon and anadromous trout species that are eligible for protection as listed or candidate species under state or federal endangered species acts shall be given top funding priority.
(C) Projects shall be cost-effective and treat causes and not symptoms of fish habitat degradation. Projects may implement instream, riparian, water quality, water quantity, and watershed prescriptions and shall be designed to restore the structure and function of fish habitat.
(3) Any grant funds allocated to a project that exceed the actual cost of completing the project shall be returned to the Salmon and Steelhead Trout Restoration Account.
(d) (1) A citizen’s advisory committee shall be appointed by the Director of Fish and Game to give advice on the grant program.
(2) The advisory committee shall consist of seven representatives recommended by the California Advisory Committee on Salmon and Steelhead Trout, one representative from the agriculture industry, one representative from the timber industry, one representative of public water agency interests, one academic or research scientist with expertise in anadromous fisheries restoration, and three county supervisors from coastal counties in which anadromous trout exist. The county supervisor members shall be recommended by the California State Association of Counties.
(3) The advisory committee shall provide oversight of, and recommend priorities for, grant funding under this section. In making funding decisions, the Department of Fish and Game shall consider the project selection priorities established by the advisory committee.
(4) Members of any advisory committee established for these purposes shall be reimbursed for travel and incidental expenses related to the performance of their duties under this section. Reimbursement for the advisory committee created pursuant to this section shall be made from the funds designated in subparagraph (B) of paragraph (1) of subdivision (c). Reimbursement for other Department of Fish and Game salmon and steelhead trout advisory committees shall be funded by appropriate sources.
(5) If a member of the advisory committee, or a member of his or her immediate family, is employed by a grant applicant, the employer of a grant applicant, or a consultant or independent contractor employed by a grant applicant, the advisory committee member shall make that disclosure to the other members of the committee, and shall not participate in reviewing or making recommendations on the grant application of that applicant. For purposes of this paragraph, “independent contractor” has the same meaning as defined in Section 30 of the Labor Code.
(e) Except as provided in subdivision (f), the money in the Salmon and Steelhead Trout Restoration Account shall be allocated as follows:
(1) Not less than 65 percent of the money shall be used for salmon habitat protection and restoration projects. Of that amount, at least 75 percent shall be used for watershed (upslope) and riparian area protection and restoration activities. These activities may include, but are not limited to, grants to acquire and install fish screens to protect juvenile and adult salmon and steelhead trout from entrapment in water diversions, and grants to remove substandard culverts, stream crossings, and bridges that constitute barriers to spawning of salmon and steelhead trout and passage of fish. These funds may also be used for the acquisition, from willing sellers, of conservation easements for riparian buffer strips along coastal rivers and streams to protect salmon and steelhead trout habitat or for projects that protect and improve water quality and quantity.
(2) Up to 35 percent of the money shall be allocated for any of the uses listed in this paragraph.
(A) Watershed evaluation, assessment, and planning necessary to develop a site-specific and clearly prioritized plan to implement watershed improvements.
(B) Multiyear grants for watershed planning and project monitoring and evaluations.
(C) Watershed organization support and assistance.
(D) Project maintenance and monitoring after the project implementations are complete.
(E) Public school watershed and fishery conservation education projects.
(F) Private sector technical training and education project grants, including teaching private landowners about practical means of improving land and water management practices that, if implemented, will contribute to the protection and restoration of salmon stream habitat; scholarship funding for workshops and conferences that teach restoration techniques; operation of nonprofit restoration technical schools; and production of restoration training and education workshops and conferences.
(G) Fish and wildlife habitat improvements, as defined by Section 4793, and authorized under the California Forestry Incentive Program (CFIP).
(H) The salmon restoration project of the California Conservation Corps.
(I) The state’s share of the federal Watershed Stewards Program.
(J) Monitoring projects that utilize protocols approved by the Department of Fish and Game and the National Marine Fisheries Service (NMFS) to provide baseline or trend data, or both, for anadromous fish populations or the physical and biological factors known to be limiting recovery.
(K) Artificial propagation programs designed to restore depleted stocks of salmonids that comply with the directives of the joint Department of Fish and Game and NMFS Hatchery Operations Review Committee.
(f) The advisory committee, in any fiscal year, may make a recommendation to the Department of Fish and Game to allocate money from the Salmon and Steelhead Trout Restoration Account for the purposes stated in subdivision (e), but in different percentage requirements than the 65/35 split stated in paragraphs (1) and (2) of that subdivision. Following that recommendation, the Director of Fish and Game may suspend the percentage requirements stated in paragraphs (1) and (2) of subdivision (e) for that fiscal year only.

SEC. 19.

 Section 20.2 is added to the Public Utilities Code, to read:

20.2.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code

SEC. 20.

 Section 23.5 is added to the Revenue and Taxation Code, to read:

23.5.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 21.

 Section 17.5 is added to the Unemployment Insurance Code, to read:

17.5.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 22.

 Section 364 is added to the Vehicle Code, to read:

364.
 “Independent contractor” has the same meaning as defined in Section 30 of the Labor Code

SEC. 23.

 Section 27 is added to the Water Code, to read:

27.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.

SEC. 24.

 Section 28 is added to the Welfare and Institutions Code, to read:

28.
 “Independent contractor,” as used in this code, has the same meaning as defined in Section 30 of the Labor Code.