Bill Summary – FastDemocracy

HOUSE . . . . . . . . . . . . . . . No. 4259
                         The Commonwealth of Massachusetts
                                     ——————
          INITIATIVE PETITION OF CHARLES DEWEY ELLISON, III AND
                                  OTHERS.
                                                    OFFICE OF THE SECRETARY.
                                                    BOSTON, JANUARY 10, 2024.
      Steven T. James
      Clerk of the House of Representatives
      State House
      Boston, Massachusetts 02133
      Sir: — I herewith transmit to you, in accordance with the requirements of Article
      XLVIII of the Amendments to the Constitution an “Initiative Petition for a Law
      Establishing that App-Based Drivers are not Employees, and Network Companies
      are not Employers, for Certain Purposes of the General Laws,” signed by ten
      qualified voters and filed with this department on or before December 6, 2023,
      together with additional signatures of qualified voters in the number of 92,555,
      being a sufficient number to comply with the Provisions of said Article.
                                                    Sincerely,
                                                       WILLIAM FRANCIS GALVIN
                                                       Secretary of the Commonwealth.
                               AN INITIATIVE PETITION.
         Pursuant to Article XLVIII of the Amendments to the Constitution of the
      Commonwealth, as amended, the undersigned qualified voters of the
      Commonwealth, ten in number at least, hereby petition for the enactment into law
      of the following measure:
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                                                      FILED ON: 1/25/2024
      HOUSE . . . . . . . . . . . . . . . No. 4259
                               The Commonwealth of Massachusetts
                                                      _______________
                                    In the One Hundred and Ninety-Third General Court
                                                       (2023-2024)
                                                      _______________
     An Act establishing that app-based drivers are not employees, and network companies are not
     employers, for certain purposes of the General Laws.
            Be it enacted by the People, and by their authority, as follows:
        SECTION 1. Section 148B of chapter 149 of the General Laws is hereby amended by
 inserting after subsection (e) the following subsection:
        (f) Notwithstanding subsection (a), for the purpose of this chapter and chapter 151, an
 app-based driver, as defined in chapter 159AA, shall not be an employee under those chapters.
        SECTION 2. Section 6 of chapter 151A of the General Laws is hereby amended by
 inserting after subsection (x) the following subsection:
        (y) Service performed by an app-based driver, as defined in chapter 159AA.
        SECTION 3 Subsection (4) of section 1 of chapter 152 of the General Laws is hereby
 amended by striking out the words "and (g)" and inserting in place thereof the following words:-
 (g) a person who is an app-based driver, as defined in chapter 159AA, and (h)
        SECTION 4. The General Laws are hereby amended by inserting after chapter 159Al/2
 the following chapter:
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        Chapter 159AA
        Section 1. Title. This chapter shall be known as the "Relationship Between Network
 Companies and App-Based Drivers Act."
        Section 2. Purpose. The purpose of this chapter is to define and regulate the relationship
 between network companies and app-based drivers. The chapter requires network companies to
 provide app-based drivers with minimum compensation, healthcare stipends, earned paid sick
 time, and occupational accident insurance that will operate uniformly throughout the
 commonwealth, while protecting app-based drivers' freedom and flexibility to choose when, how
 long, how often, and for whom they work.
        Section 3. App-Based Driver Contractual Requirements. (a) The requirements in this
 section and sections 5 through 8 of this chapter are incorporated into every contract made,
 modified, or renewed on or after the effective date of this chapter between an app-based driver
 and a network company with regard to delivery services or transportation services. Such
 contracts may contain supplemental terms that are in addition to those required by this chapter.
        (b)     A network company shall not terminate a contract with an app-based driver,
 except on grounds specified in the contract or as is required by law.
        (c)     A contract between a network company and an app-based driver shall provide
 app-based drivers whose contracts are terminated by the network company the opportunity to
 appeal such termination with the network company.
        (d)     A network company shall not, unless based upon a bona fide occupational
 qualification or public or app-based driver safety need, refuse to contract with or terminate the
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 contract of an app-based driver based upon race, color, age, religious creed, national origin, sex,
 gender identity, genetic information, ancestry, active military personnel, status as a veteran,
 pregnancy or a condition related to said pregnancy including, but not limited to, lactation or the
 need to express breast milk for a nursing child, or the handicap of a qualified handicapped person
 or sexual orientation, which shall not include persons whose sexual orientation involves minor
 children as the sex object.
        (e)     Nothing in this chapter applies to any contract in existence before the effective
 date of this chapter.
        Section 4. Definitions. For the purposes of this chapter, the following words shall have
 the following meanings:
        "App-based driver", a person who is a DNC courier, a TNC driver, or both, who has a
 contract with a network company, and for whom the following requirements are met:
        (a)     the network company does not unilaterally prescribe specific dates, times of day,
 or a minimum number of hours during which the app-based driver must be logged into the
 network company's online-enabled application or platform;
        (b)     the network company may not terminate the contract of the app-based driver for
 not accepting a specific transportation service or delivery service request except where refusal
 constitutes a violation of governing federal, state, or local laws or regulations;
        (c)     the network company does not restrict the app-based driver from performing
 services through other network companies except while performing services through the network
 company's online-enabled application or platform; and
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        (d)     the network company does not contractually restrict the app-based driver from
 working in any other lawful occupation or business.
        "Average ACA contribution", 82 per cent of the dollar amount of the average monthly
 Health Connector premium.
        "Average hourly earnings", an app-based driver's earnings during the 365 days
 immediately prior to the day that earned paid sick time is used, divided by the total hours of
 engaged time worked by the app-based driver on that network company's online-enabled
 application or platform during that period.
        "Average monthly Health Connector premium", the dollar amount published pursuant to
 subsection (f) of section 6 of this chapter.
        "Contract", a written agreement, which may be electronic, between an app-based driver
 and a network company.
        "Delivery Network Company" or "DNC", a business entity that (a) maintains an online-
 enabled application or platform used to facilitate delivery services within
        the Commonwealth and (b) maintains a record of the amount of engaged time and
 engaged miles accumulated by DNC couriers.
        "Delivery Network Company Courier" or "DNC courier", a person who provides delivery
 services through a DNC's online-enabled application or platform.
        "Delivery services", the fulfillment of a delivery request, meaning the pickup from any
 location in the Commonwealth of any item or items and the delivery of the items using a private
 passenger motor vehicle, bicycle, electric bicycle, motorized bicycle, scooter, motorized scooter,
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 walking, public transportation, or other similar means of transportation, to a location selected by
 the customer located within 50 miles of the pickup location. A delivery request may include
 more than I, but not more than 30, distinct orders placed by different customers. Delivery
 services may include the selection, collection, or purchase of items by a DNC courier, as well as
 other tasks incident to a delivery. Delivery services do hot include assistance with residential
 moving services.
         "Earnings", all amounts, including incentives and bonuses, remitted to an app-based
 driver by a network company, provided that the amount does not include toll fees, cleaning fees,
 airport fees, or other customer pass-throughs. Amounts remitted are net of service fees or similar
 fees charged to the app-based driver by the network company. Amounts remitted do not include
 tips or gratuities.
         "Earnings period", a recurring period of time, set by the network company, not to exceed
 14 consecutive calendar days.
         "Engaged miles", all miles traveled during engaged time in a private passenger motor
 vehicle that is not owned, leased, or rented by the network company, or any of its affiliates.
 Network companies may exclude miles if doing so is reasonably necessary to remedy or prevent
 fraudulent use of the network company's online-enabled application or platform.
         "Engaged time", (a) subject to the conditions set forth in subsection (b) in this definition,
 the period of time, as recorded in a network company's online-enabled application or platform,
 from when a app-based driver accepts a request for delivery or transportation services to when
 the driver fulfills that request. For requests that are scheduled in advance and for which the app-
 based driver accepts the request but is not immediately en route to fulfill that request, a driver
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 shall only be considered engaged on a network company's platform when the app-based driver is
 en route to fulfill that scheduled request, regardless of when the app-based driver accepted the
 request.
        (b) Engaged time shall not include (1) any time spent performing delivery or
 transportation services after the request has been cancelled by the customer; or (2) any time spent
 on a request for delivery or transportation services where the app-based driver abandons
 performance of the service prior to completion. Network companies may also exclude time if
 doing so is reasonably necessary to remedy or prevent fraudulent use of the network company's
 online-enabled application or platform.
        "Health Connector", the Commonwealth Health Insurance Connector Authority
 established by chapter 58 of the acts of 2006 and section 2 of chapter 176Q of the Massachusetts
 General Laws.
        "Minimum wage", the state mandated minimum wage for all industries as provided by
 section 1 of chapter 151 of the Massachusetts General Laws.
        "Net earnings", all earnings received by an app-based driver in an earnings period.
        "Net earnings floor", means the amount determined under subsection (c) of Section 5 of
 this chapter, against which an app-based driver's net earnings are compared.
        "Network company", a business entity operating as:
        (a)      a delivery network company;
        (b)      a transportation network company; or
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        (c)     both.
         "Person", shall have the same definition as provided in clause twenty-third of section 7
 of chapter 4 of the Massachusetts General Laws.
        "Private passenger motor vehicle," any passenger vehicle which has a vehicle weight
 rating or curb weight of 6,000 lbs. or less as per manufacturer's description of said vehicle or is a
 sport utility vehicle, passenger van, or pickup truck.
        "Qualifying health plan", a health insurance plan in which the app-based driver is the
 subscriber, that is not paid for in full or in part by any current or former employer, and that is not
 a Medicare or Medicaid plan.
        "Quarter", each of the following 4 time periods: (a) January 1 through March 31; (b)
 April 1 through June 30; (c) July I through September 30; (d) October 1 through December 31.
        "Transportation network company" or "TNC", has the same meaning as provided in
 section I of chapter 159Al/2 of the Massachusetts General Laws.
        "Transportation network company driver" or "TNC driver", a Transportation network
 driver, as defined in section I of chapter 159Al/2 of the Massachusetts General Laws, that
 provides transportation services, or a person operating a livery vehicle as defined in 540 CMR
 2.00 on a TNC's digital network, as defined in section 1 of chapter 159Al/2.
        "Transportation services", the provision of transportation facilitated by the digital
 network, as defined in section 1 of chapter 159Al/2 of the Massachusetts General Laws, of a
 TNC for which the pickup of the passenger occurs in the Commonwealth.
        Section 5: Guaranteed Earnings Floor.
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        (a)     A network company shall ensure that for each earnings period, an app-based
 driver is compensated at not less than the net earnings floor as set forth in this section. The net
 earnings floor establishes a guaranteed minimum level of compensation for app-based drivers
 that cannot be reduced. In no way does the net earnings floor prohibit app-based drivers from
 earning a higher level of compensation.
        (b)     For each earnings period, a network company shall compare an app-based driver's
 net earnings against the net earnings floor for that app-based driver during the earnings period. In
 the event that the app-based driver's net earnings in the earnings period are less than the net
 earnings floor for that earnings period, the network company shall include an additional sum
 accounting for the difference in the app-based driver's earnings no later than during the next
 earnings period.
        (c)     For all earnings periods, the net earnings floor shall be the sum of:
        (i)     The product of 120 per cent of the minimum wage and the number of hours of
 engaged time during that earnings period.
        (ii)    (A) The product of the per-mile compensation for vehicle expenses set forth in
 this clause and the total number of engaged miles traveled during that earnings period.
        (B) After the effective date of this chapter and for the 2025 calendar year, the per-mile
 compensation for vehicle expenses shall be 28 cents per engaged mile. For calendar years after
 2025, the amount per engaged mile shall be adjusted pursuant to the following subsection (d).
        (d)     For calendar years following 2025, the executive office of labor and workforce
 development shall adjust the per-mile compensation amount under subsection (c) annually to
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 reflect the percentage increase, if any, in the state minimum wage that is set to take effect that
 calendar year. The executive office of labor and workforce development shall calculate and
 publish the adjustments required by this subsection no later than November 30 of the year prior
 to the increase taking effect. The adjusted compensation rates shall take effect on the later of
 January 1 or the sixty-first day following publication. If the executive office of labor and
 workforce development does not publish an increase as required by this subsection, no increase
 in the compensation amounts shall occur.
        (e)     Nothing in this section shall be interpreted to require a network company to
 provide a particular amount of compensation to an app-based driver for any given transportation
 or delivery request, as long as the app-based driver's net earnings for each earnings period equals
 or exceeds that app-based driver's net earnings floor for that earnings period as set forth in
 subsection (b) of this section.
        Section 6. Healthcare Stipend.
        (a)     Consistent with the average contributions required under the federal Patient
 Protection and Affordable Care Act, Pub. L. 111-148 (March 23, 2010), a network company
 shall provide a quarterly healthcare stipend to app-based drivers who meet the conditions set
 forth in this section. An app-based driver that averages the following amounts of engaged time
 per week on a network company's platform during a quarter that commences on or after January
 1, 2025 shall receive the following stipends from that network company:
        (1)     For an average of 25 hours or more per week of engaged time in the quarter, a
 payment greater than or equal to 100 per cent of the average ACA contribution for the applicable
 average monthly Health Connector premium for each month in the quarter.
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          (2)    For an average of at least 15 but less than 25 hours per week of engaged time in
 the quarter, a payment greater than or equal to 50 per cent of the av