Legislation in the Washington State House could cripple survey, opinion and marketing research involving respondent incentives by creating the presumption that anyone receiving remuneration for services is an employee.
The "Employee Fair Classification Act" (H.B. 1440), sponsored by Rep. John McCoy (D-38), will be considered by the House Committee on Finance at 1:30pm on February 18. It already passed the House Committee on Labor & Workforce Development on February 7.
H.B. 1440 would create a presumption in law that an employer-employee relationship exists whenever a person gets paid to perform services. The burden to refute that presumption that everyone is an employee would lie with the employer.
This bill would have a detrimental impact on any research company or organization using incentives for respondents. Rather than the current practice in Washington and other states, the "employer" would have to rebut the presumption that every person receiving payment for services is an employee. This would impose massive administrative overhead, as well as costly payments into workers compensation and unemployment compensation funds on behalf of every respondent receiving an incentive for participating in a research study. Research companies in Washington would have to do all that until they are able to provide sufficient evidence to the Department of Labor and Industries that the respondents are independent contractors and not employees. Upon receiving such evidence, the State would then have to refund the money that was erroneously collected from the company or organization.
This is not only ridiculous, it is a waste of resources for both the State and the companies and organizations involved. It would make much more sense for the State to examine individual claims of misclassification rather than assuming en banc that every independent contractor has been misclassified.
Legislation and regulatory activity like WA H.B. 1440 are the reason MRA sought the introduction last year of the Research Fairness Act (H.R. 5915 in the last Congress), to clarify the treatment under federal labor law of respondents receiving incentives as independent contractors, not employees.
MRA will be contacting the members of the House Committee on Finance in advance of their February 18 meeting to request that they either amend H.B. 1440 to exclude respondent incentives, or bottle up this legislation in their committee and not allow it to advance. Any MRA members in Washington willing to contact their state Repreentatives about H.B. 1440 should contact MRA Director of Government Affairs, Howard Fienberg, as soon as possible.