Ray McCarty, president of Associated Industries of Missouri, told a House committee this week that the association supports clearer rules for determining when a person is an independent contractor.
House Bill 1642, sponsored by Rep. Kurt Bahr (R-St. Charles), requires the Missouri Department of Labor and Industrial Relations to provide a clear and concise rule for defining “independent contractor” and a procedure for changing an individual’s classification from an independent contractor to an employee.
Language in the bill states that if the federal government has allowed a person to be classified as an independent contractor, the state will consider the person an independent contractor too.
The bill also gives an employer 60 days to comply with the reclassification of an employee after the department audits the employer. And the employer will not be liable for any taxes, interest, or fines for the misclassification.
Employers will be given six months to comply with the new rules once they are drawn up by the department.
“AIM supports the idea of drafting hard and fast rules about who is and isn’t an independent contractor,” McCarty testified before the House Workforce Development Committee. “We also support the six month period for employers to comply with the department’s rules. With this bill, Missouri employers would have certainty in an area that is anything but certain.”