Bill eroding independent contractor status given "go ahead" to Senate floor

| 5/13/2002

A California bill eroding the classification of an independent contractor was found by the state's Senate Appropriations Committee to have minimal fiscal impact and was given the green light this week to advance for consideration on the Senate floor.

The California Chamber of Commerce opposed SB1407, introduced by Sen. John Burton (D-San Francisco), mandates that companies provide workers' compensation insurance coverage for independent contractor taxicab drivers the company is contracting.

The Chamber believes SB1407 deviates from the basic premise that independent contractors are not considered employees for the purpose of workers' compensation. The workers' compensation program is premised on employed injured workers being provided coverage on a no-fault basis for injuries "arising out of employment and in the course of employment."

SB1407 establishes a separate standard for a single class of working persons and implies a "false" façade of employment. In addition, common law and additional case law recognizes the distinction between a self-employed independent contractor and an employee.

The Chamber believes, if passed, this bill only serves to open the door for workers' compensation coverage for all independent contractors regardless of industry or class and would be contrary to the basic premise of long-held standards as established by common and case law.

SB1407 is scheduled for its third reading on the Senate floor May 13. The Chamber is urging businesses to ask their senators to oppose the bill. A sample letter is available at the CalChamber capitol connection ( web site.