On the first day of the 2023 – 2026 legislative quadrennium, the Alabama State Senate convened for its organizational wession. One of the main topics of the day was designating
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We have previously written about the growing complications of employee vs. independent contractor classification in the wake of unemployment assistance in the pandemic era, not only for out-of-work employees but, for the first time, self-employed individuals. In that newsletter, we referenced House Bill 408 that was making its way through the Alabama Legislature, which aims to add clarification to this classification quandary for Alabama businesses.
On April 19, 2021, Gov. Kay Ivey signed House Bill 408, sponsored by Rep. Wes Kitchens (R-Marshall County/Blount County) and Sen. Clay Scofield (R-Guntersville), into law as
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On April 19, 2021, Gov. Kay Ivey signed House Bill 408, sponsored by Rep. Wes Kitchens (R-Marshall County/Blount County) and Sen. Clay Scofield (R-Guntersville), into law as
Act 2021-226, which will become effective July 1. A bipartisan group of state representatives and senators supported the law, evidenced by the fact that it passed unanimously (99-0, 31-0) in both chambers. The Business Council of Alabama, Manufacture Alabama, and the Birmingham Business Alliance each advocated for the bill, and it was supported by the Governor’s office.
We expect this legislation to help employers avoid unnecessary worker misclassification assessments and steep penalties, since it requires both the Alabama Department of Labor (ALDOL) and Alabama Department of Revenue (ALDOR) to follow the IRS’s traditional common law test, also known as the “20-factor test,” which has been around for decades. That test tends to be more pro