Model law to reduce misclassifications in trucking, courier industries

State legislators involved in insurance activities have developed a solution to the issue of misclassification of employees in the trucking and courier industries. The National Conference of Insurance Legislators adopted the model law at its spring meeting in Washington, D.C. last month.

Called the Trucking and Messenger Courier Industries Workers' Compensation Insurance Model Act, the law would establish a six-point statutory test to determine whether someone is an independent contractor or an employee. The move comes in response to concerns and investigations of companies that have misclassified workers as independent contractors and therefore not covered by workers' comp laws.

The model act, based on a Minnesota law, would establish six standards, related to:

Equipment ownership.
Operating responsibilities and costs.
Compensation.
Control over the work performed.
A certification statement.

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People who do not meet all six standards would be considered employees.

NCOIL developed a similar model act two years ago to address misclassification of employees in the construction industry.

Read more at the WorkersComp Forum homepage.

April 7, 2011

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