The state of Tennessee is working to revamp the Workers’ Compensation laws in their state. A new bill was introduced to Tennessee, known as House Bill 539. It is sponsored by Tennessee State Representative Dan Howell, a Republican from Georgetown. House Bill 539 plans to change the way Tennessee determines whether or not an employer-employee relationship exists. The House unanimously approved the bill, 87-0, in the third and final consideration on April 1, 2019.
Determining the relationship between an employer and their employee is very important in Workers’ Compensation Laws. The new bill introduced in Tennessee would require the Tennessee Department of Labor and Workforce Development to implement a 20-factor test by the United States Internal Revenue Service. It calls for the use of the test in IRS Revenue Ruling 87-41 to determine the nature of the relationship. This is for purposes of the state’s wage and hour laws, the Occupational Safety and Health Act of 1972, the Tennessee Employment Security Law, as well as the drug-free workplace laws. It also exists to determine if an individual is an independent contractor or an employee under Compensation Law.
The IRS Revenue Ruling considers several factors to determine if an individual is an independent contractor or an employee. These factors include:
- Instructions
- Training
- Integration
- Services rendered personally
- Hiring, supervision, and paying assistants
- Continuing relationship
- Set hours of work
- Full time required
- Doing work on employer
About 34 states have already implemented the test, with Tennessee looking to be the next. The state currently uses the ABC test to determine the relationship. The ABC test is a three-part test that employers are required to meet in order to classify a worker as an independent contractor. The burden falls on these employers to prove their workers are independent contractors. Under the ABC test, a worker is an independent contractor if they meet all three parts of the following:
- If workers are free from the control and direction of the hirer in relation to the performance of the work
- The worker performs work outside the usual course of the hirer’s business
- The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work done for the employer
Another factor of the test states that employers cannot hire an independent contractor to perform similar duties to those of regular employees still be classified as independent. If an employer cannot prove these three stipulations, the worker is classified as an employee.
Tennessee Representative Dan Howell refers to the ABC test as “ambiguous.” The new test implemented by the IRS Revenue Ruling is believed to be a more thorough test. Howell continued in saying, “It is imperative that Tennessee adopts this policy, which has been upheld by the Supreme Court, so we can continue to be the best state in the nation to live, work and raise a family.”
The bill will continue to the Tennessee Senate where it will be considered within the next few weeks.
If you have become the victim of an on the job injury, it may be beneficial to speak with an attorney and the doctor that is treating you to determine how to make the process as easy as possible. AllianceMeds understands that a workplace accident can be challenging and is here to help. We will deliver your medication to your door using overnight delivery and cover any out of pocket expenses that may arise. If you have any questions about how we can help, contact AllianceMeds today.