File No. 35093
This rule was published in the August 15, 2011, issue (Vol. 2011, No. 16) of the Utah State Bulletin.
Labor Commission, Administration
Definitions Applicable to Construction Licensees
Notice of Proposed Rule
DAR File No.: 35093
Filed: 07/22/2011 08:59:28 AM
Purpose of the rule or reason for the change:
Pursuant to the rulemaking authority granted to the Labor Commission by S.B. 35 (2011 General Session), the purpose of this rule is to define certain terms used within S.B. 35 and to establish a procedure by which an unincorporated entity licensed to perform construction by the Division of Professional Licensing (DOPL) can challenge the presumption created by S.B. 35 that such an entity is an employer for purposes of Utah laws dealing with payment of wages, employment discrimination, and occupational safety and health.
Summary of the rule or change:
The proposed rule defines the following terms: a) "active manager"; b) "directly holds at least an 8% ownership interest"; c) "indirectly holds at least an 8% ownership interest"; and d) "subject to supervision or control in the performance of work." The proposed rule also identifies two methods by which an unincorporated entity may challenge the presumption created by S.B. 35 that the entity is an employer for purposes of payment of wages, employment discrimination, and occupational safety and health: 1) by requesting a declaratory determination from the Commission; or 2) as part of an existing adjudicatory proceeding.
State statutory or constitutional authorization for this rule:
- Subsection 34-28-2(2)
- Subsection 34A-6-103(2)
- Subsection 34A-5-102(2)
Anticipated cost or savings to:
the state budget:
By defining terms and clarifying procedures, the proposed rule should facilitate the Labor Commission's ability to resolve disputes regarding an unincorporated entity's status as an employer. However, in view of the fact that such disputes are relatively infrequent, the Commission does not anticipate appreciable costs or savings to the state budget as a result of the proposed rule.
The definitions and procedures of the proposed rule have no application to local government and will not result in any costs or savings to local government budgets.
Pursuant to S.B. 35, unincorporated entities licensed to perform construction by DOPL are presumed to be employers of all their workers and staff. The proposed rule defines terms and establishes procedures to simplify the manner by which such entities can challenge that presumption. While the proposed rule should tend to make the above-described process simpler and therefore, less expensive to participants, such proceedings are relatively infrequent. Consequently, the Commission does not anticipate that the proposed rule will result in any appreciable cost or savings to the affected small businesses.
persons other than small businesses, businesses, or local governmental entities:
Individual workers who are presumed under S.B. 35 to be employees of unincorporated entities may also be affected by the proposed rule's definitions and procedures. The proposed rule defines terms and establishes procedures to simplify the manner by which such entities can challenge that presumption. While the proposed rule should tend to make the above-described process simpler and therefore less expensive to all participants, including workers, such proceedings are relatively infrequent. Consequently, the Commission does not anticipate that the proposed rule will result in any appreciable cost or savings to other persons affected by the proposed rule.
Compliance costs for affected persons:
The proposed rule's definitions and procedures do not impose any compliance costs on affected persons.
Comments by the department head on the fiscal impact the rule may have on businesses:
The proposed rule deals with the relatively infrequent situation in which an unincorporated entity licensed by DOPL to perform construction seeks to rebut the presumption created by S.B. 35 that the unincorporated entity is an employer. The proposed rule's definitions and procedures should render these proceedings simpler and more efficient for all the participants and for the Commission. Consequently, the Commission does not anticipate that the proposed rule will have any negative fiscal impact on businesses.
Sherrie Hayashi, Commissioner
The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:Labor Commission
160 E 300 S
SALT LAKE CITY, UT 84111-2316
Direct questions regarding this rule to:
- Alan Hennebold at the above address, by phone at 801-530-6937, by FAX at 801-530-6390, or by Internet E-mail at firstname.lastname@example.org
Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:
This rule may become effective on:
Sherrie Hayashi, Commissioner
R600. Labor Commission, Administration.
The Portable Document Format (PDF) version of the Bulletin is the official version. The PDF version of this issue is available at https://rules.utah.gov/publicat/bull-pdf/2011/b20110815.pdf. The HTML edition of the Bulletin is a convenience copy. Any discrepancy between the PDF version and HTML version is resolved in favor of the PDF version.
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For questions regarding the content or application of this rule, please contact Alan Hennebold at the above address, by phone at 801-530-6937, by FAX at 801-530-6390, or by Internet E-mail at email@example.com.