For the purposes of ARM Title 24, chapter 35, the following definitions apply:

(1) "Department" means the Montana Department of Labor and Industry.

(2) "Employment status" means the employment relationship between an individual and a hiring agent.

(3) "Fixed business location" means a principle place of business for any trade, occupation, profession, or business that is designated by the owner as the physical location where customers are directed for any physical contacts with the business and is the actual location where the majority of the business work is regularly performed. More than a place to store inventory or product samples, a fixed business location is where a person engages in work intended for commerce.

(4) "Hiring agent" means the entity that hires an individual to perform services. A hiring agent may be an "employer" as defined in 39-3-201, MCA; 39-51-202, MCA; 39-71-117, MCA; or other legal entity as defined by an "employing unit" in 39-51-201, MCA.

(5) "Incomplete application" means an application submitted for an exemption as an independent contractor that fails to qualify for a minimum of 15 points due to insufficient, missing, unverifiable, or incorrect information; or due to failure to submit an essential component, such as a signed and notarized waiver or required fee.

(6) "Independent Contractor Central Unit" or "ICCU" means the unit located within the department which is responsible for making employment status decisions for the entire department and other agencies that elect to participate in the ICCU. The ICCU evaluates ICEC applications and investigates working relationships identified in complaints and referrals.

(7) "Independent Contractor Exemption Certificate" or "ICEC" means a certificate issued by the department that signifies a person meets the criteria for an exemption from the provisions of the Workers' Compensation Act for a specific trade, occupation, profession, or business.

(8) "Individual" means a person who renders service in the course of a trade, occupation, profession, or business.

(9) "Initial application" means a person's first-time application for exemption as an independent contractor for a particular trade(s), occupation(s), profession(s), or business(es).

(10) "Party" means a person or entity designated by the department as plaintiff or respondent in an ICCU decision-making proceeding. The department, the claimant, employer(s), hiring agent(s), ICEC holders, insurer(s), or agencies of state government may be a party to an ICCU decision-making proceeding or appeal of an ICCU decision to the Workers' Compensation Court.

(11) "Renewal application" means an application for renewal of an existing ICEC held by that person.

(12) "Revoked" and "revocation" mean that an ICEC is no longer in force or effect.

(13) "Similarly situated individuals" means people who render services for an employer under circumstances substantially the same as those under which the subject individual's services were performed.

(14) "Suspended" and "suspension" mean that a person's ICEC is not applicable to a particular job or to a series of jobs for a particular hiring agent.

(1) The applicant for an ICEC shall submit:

(a) a completed ICEC application on a department-approved form bearing the applicant's original notarized signature, as required by ARM 24.35.112.

(b) a fee, as required by ARM 24.35.121; and

(c) an executed, notarized waiver conforming to the requirements of ARM 24.35.113.

(2) The department shall approve or deny an ICEC application within 30 days of receipt and notify the applicant in writing.

(3) The department shall retain an incomplete or denied application for a period of six months from the date of receipt and allow the applicant the opportunity to supplement supporting documentation or submit missing components. Upon the written request of applicant, the department shall re-evaluate an application, taking into consideration the supplemental information submitted by applicant. Incomplete applications that have not been approved within six months of receipt by the department will remain denied.

(1) On the form provided by the department, the applicant shall provide all information designated as required. The form must be notarized, and the applicant must state, under oath, the veracity of all information on and attached to the form.

(2) The applicant shall also submit supporting documentation to prove applicant's qualification for an ICEC. The department has the discretion to assess the reliability of the documentation and award points for each item of proof as outlined by this rule. Each item of documentation submitted may count toward points in more than one category. No more than two items of proof may be submitted under each category. To qualify for an ICEC, an applicant's documentation must be awarded a minimum of 15 points by the department for each independently established trade, occupation, profession, or business listed on the ICEC application.

(a) The department may award up to ten points for proof that the applicant has current workers' compensation, unemployment insurance, and Department of Revenue accounts for employees in each independently established trade, occupation, profession, or business. The department may award up to six points for proof of two insurance policies or accounts and may award up to three points for proof of one insurance policy or account.

(b) The department may award up to six points for each of the following proofs for each independently established trade, occupation, profession, or business:

(i) contract or memo of understanding that demonstrates applicant's independent contractor status. If the applicant can end a contract at any time without incurring any liability for failing to complete the project that is the subject of the contract, the department cannot award points for the contract under this rule. Separate contracts with different hiring agents may qualify for a maximum of six points. Each contract must include:

(A) payment based on a completed project;

(B) beginning and ending dates of the contract;

(C) liability for failure to complete the project;

(D) identification of who provides the materials and supplies;

(E) signatures by both parties; and

(F) defined body of work, complete project, or end result;

(ii) signed and dated list of equipment and tools owned or controlled by the applicant with approximate values. The equipment or tool list may be documented by a rental or lease agreement, county documents verifying the business equipment tax paid, or other means;

(iii) commercial general liability insurance policy or bonding;

(iv) most recent business tax forms filed within the past three years;

(v) IRS Form 1099s (miscellaneous income) from multiple hiring agents or two quarterly self-employment tax payments (IRS form 1040ES) within past three years; or

(vi) trucking company lease agreement.

(c) The department may award up to three points for each of the following proofs for each independently established trade, occupation, profession, or business:

(i) partnership or limited liability partnership agreement signed and dated by all partners that demonstrates:

(A) intent to form the partnership;

(B) contribution by all partners;

(C) a proprietary interest and right of control by the application; and

(D) the sharing of profit/loss;

(ii) current business license or building permit;

(iii) certificate of registration for the business entity issued by the Montana secretary of state;

(iv) articles of incorporation, annual report, articles of organization, or other documentation that verifies the applicant is an officer in a corporation, a manager in a manager-managed limited liability company, or a member of a member-managed limited liability company;

(v) proof of ownership, home occupation license, rental or lease agreement with a statement that the property may be used for business or commercial use, or proof of IRS filing for use of home as a business;

(vi) educational certification for unlicensed occupations relevant to the trade, occupation, or profession for which the applicant seeks the ICEC;

(vii) current professional license relevant to the trade, occupation, or profession for which the applicant seeks the ICEC;

(viii) membership in a relevant professional association or affiliation;

(ix) current motor carrier (MC) authority number in applicant's personal or business name;

(x) business bank account; or

(xi) copies of advertising in a newspaper, phone book, web site on the internet, or other venue.

(d) The department may award up to one-and-one-half points for each of the following proofs for each independently established trade, occupation, profession, or business:

(i) federal employer identification number (EIN);

(ii) Dunn and Bradstreet number;

(iii) telephone or utility bill(s) in the business name;

(iv) credit card(s) or purchase account(s) in the business name;

(v) preprinted business invoices, business cards, or brochures;

(vi) proof of order(s) for printed hats, shirts, or other promotional items for the business;

(vii) proof of business advertising using a vehicle sign, yard sign, bulletin boards, or posted flyers;

(viii) invoices billed to the business name or a bid proposal or estimate, either of which must include the address and phone number of the recipient;

(ix) vehicle registration(s) in the business name; or

(x) international fuel tax account number (IFTA) in the applicant's personal or business name.

(e) The applicant may submit any other supporting documentation. The department has discretion to assess the reliability of and determine the point value of any documentation not listed in this rule.

(1) To execute a waiver, the applicant shall complete the department-approved waiver form. The waiver form must be signed by the applicant and notarized. The applicant shall represent on the waiver form that:

(a) the applicant is engaged in each independently established trade, occupation, profession, or business that is specifically identified on the application form;

(b) the applicant is responsible for all taxes related to the applicant's work as an independent contractor;

(c) the applicant controls the details of how services are performed, both under contract and in fact, and the hiring agent retains only the control necessary to ensure the bargained for end result; and

(d) the applicant understands and agrees that if the ICEC is granted, the applicant is not eligible for and waives the right to workers' compensation or occupational disease benefits for an injury or occupational disease related to work performed as an independent contractor in each independently established trade, occupation, profession, or business for which the ICEC is granted.

This rule has been repealed.

(1) Two months prior to the expiration date of an ICEC, the department shall mail an ICEC renewal application and waiver to the ICEC holder at the address on file with the department. The department shall prepare a renewal form for each ICEC holder that incorporates the most current information in the possession of the department regarding the ICEC holder's independent contractor status and lists the documentation on file with the department that supports independent contractor status.

(2) To renew an ICEC, the ICEC holder shall submit the following:

(a) signed and notarized ICEC renewal application on the department-approved form that indicates any changes in independent contractor status;

(b) certification that previously submitted documentation remains valid;

(c) additional documentation supporting independent contractor status, as needed;

(d) a fee, as required by ARM 24.35.121; and

(e) an executed, notarized waiver on the department-approved form.

(3) The department will verify documentation on file and evaluate all new documentation submitted by the ICEC holder. The department will assign point values to documentation, in accordance with ARM 24.35.112.

(4) The department has discretion to assess the reliability of and determine the point value of any documentation not listed in ARM 24.35.112.

(5) If the department is unable to verify any documentation needed to support independent contractor status, the department will notify the ICEC holder in writing within 30 days of receipt of the renewal application.

(6) To qualify for an ICEC renewal, the ICEC holder's documentation must be awarded a minimum of 15 points by the department for each independently established trade, occupation, profession, or business listed on the ICEC renewal application.

(7) An ICEC renewal issued by the department remains in effect for a two-year period unless the department revokes or suspends the ICEC or the ICEC holder requests in writing that the department cancel the ICEC.

(8) An ICEC holder may update the information on file with the department at any time during a current independent contractor exemption certificate period by requesting in person, over the phone, by e-mail, or in writing the revision of business name(s), business structure, phone number(s), or mailing address.

(9) An ICEC holder may add or change trade(s), occupation(s), profession(s), or business(es) to an ICEC, by executing an affidavit and waiver and submitting sufficient, relevant documentation to qualify for a minimum of 15 points, in accordance with the requirements of ARM 24.35.112. When an addition is made pursuant to this section (9), the expiration date of the ICEC is not changed.

(1) A nonrefundable fee of $125 must be submitted with each initial application, each application for reinstatement of a revoked ICEC, and each renewal application.

(2) ICECs are issued for a two-year period.

(3) The department may charge a $10 fee for the reissuance of a current certificate.

(1) The department may revoke an ICEC when the department determines it is necessary to do so. The following are examples when the department may revoke an ICEC:

(a) the department is unable to locate the certificate holder or mail sent to the certificate holder at the address on file with the department is returned;

(b) the certificate holder fails to cooperate with the department, including without limitation:

(i) failure to provide information to the department upon request;

(ii) failure to complete a worker relationship questionnaire upon request; or

(iii) failure to notify the department of changes in contact information;

(c) when revocation is required by law, for example for non-payment of child support pursuant to Title 40, chapter 5, part 7, MCA; or

(d) any reason the department determines sufficiently egregious to warrant revocation of the ICEC.

(2) A person with a suspended ICEC as applied to a particular hiring agent may apply for reinstatement of the ICEC by submitting proof to the department of the ICEC holder's independent contractor status in relation to the identified hiring agent. The department shall investigate prior to reinstatement of an ICEC to ascertain that independent contractor status is established in fact.

(3) A person whose ICEC has been cancelled by the ICEC holder or revoked by the department may apply for a new ICEC pursuant to ARM 24.35.111.

(1) When the department suspends or revokes an ICEC, the certificate holder's waiver of workers' compensation benefits is no longer effective upon departmental notice to the hiring agent(s).

(2) A hiring agent is considered to have been given notice of the suspension of an ICEC on the date a written notice is personally delivered to the hiring agent, or three days after the department mails a written notice to the hiring agent, whichever is earlier.

(3) Regarding a revocation, if the department has contact information for a given hiring agent, that hiring agent is considered to have been given notice of the revocation of an ICEC on the date a written notice is personally delivered to the hiring agent, or three days after the department mails a written notice to the hiring agent, whichever is earlier.

(a) Hiring agents unknown to the department or potential future hiring agents are deemed to have notice that an ICEC is revoked at the earlier of when:

(i) the department posts notice of the revoked ICEC at its web site; or

(ii) the hiring agent has actual knowledge of the department's revocation of the ICEC.

(4) The web site address for the department's independent contractor information is www.mtcontractor.com. The telephone number for verifying the status of an ICEC is (406) 444-9029.

This rule has been repealed.

This rule has been repealed.

(1) Subject to ARM 24.35.203, when the ICCU or another unit of the department evaluates an individual's employment status, the department shall apply a two-part test to determine whether an individual is an independent contractor or an employee. The department shall evaluate:

(a) whether the individual is and shall continue to be free from control or direction over the performance of the services, both under contract and in fact; and

(b) whether the individual is engaged in an independently established trade, occupation, profession, or business.

(2) To determine whether a hiring agent exerts control over an individual, the department shall evaluate:

(a) direct evidence of right or exercise of control;

(b) method of payment;

(c) furnishing of equipment; and

(d) right to fire.

(3) To determine the employment status of an individual, the department may:

(a) review written contracts between the individual and the hiring agent;

(b) interview and obtain statements from the individual, co-workers, and the hiring agent;

(c) obtain statements from third parties;

(d) examine the books and records of the hiring agent;

(e) review filing status on income tax returns;

(f) perform onsite visits; and

(g) make any other investigation necessary to determine employment status.

(4) Decisions regarding employment status must comply with the criteria for an independent contractor found at 39-71-417, MCA, as well as with existing law on partnership, joint ventures, and other employment entities.

(5) Initial determinations regarding employment status may be issued by any unit of the department or by the Department of Revenue. Initial determinations of employment status by the department are binding on the parties unless a party disputes the determination, pursuant to ARM 24.11.2407 or 24.16.7527.

(6) ICCU "decisions" regarding employment must be called "decisions" and are separate and distinct from both initial determinations of the department and "orders" defined at ARM 24.29.205.

(7) ICCU decisions regarding employment status are binding on the department and on any other agency which elects to be included as a member of the department's ICCU, subject to the limitations contained in ARM 24.35.205(3). This does not include any agency which is merely appearing before the ICCU as a party in an employment status case (for example the state compensation insurance fund), and has not elected to be included as a member of the ICCU.

(8) The department may apply its decisions regarding employment status to similarly situated individuals.

(1) Except as provided in ARM 24.35.204, when a worker is required by 39-71-417, MCA, to have an independent contractor exemption certificate and does not, the worker is conclusively determined to be an employee for purposes of wage and hour, unemployment insurance, workers' compensation, and income tax.

(2) When a worker holds an independent contractor exemption certificate and is working under that certificate as required by 39-71-417, MCA, the worker is conclusively determined to be an independent contractor for purposes of wage and hour, unemployment insurance, workers' compensation, and income tax.

(3) When worker status is conclusively determined pursuant to this rule, the ICCU may issue a decision based solely on information sufficient to determine that conclusive outcome.

(4) Notwithstanding the foregoing, the ICCU may, at its discretion, perform an investigation pursuant to ARM 24.35.202 or when a decision is needed for a program other than wage and hour, unemployment insurance, workers' compensation, or income tax. A decision may also be issued for the purposes of suspending revoking the certificate pursuant to ARM 24.35.131 or issuing penalties, or for other purposes as the ICCU deems necessary.

(1) For purposes of this rule and the implementation of 39-51-203(4) and 39-71-419(1)(e), MCA, and requirements in certain instances not to determine status based "solely" on the lack of an ICEC, the ICCU will evaluate a worker's status pursuant to ARM 24.35.202 if: 

(a) the worker applied to the department for an ICEC prior to filing the present claim for workers' compensation or unemployment insurance benefits or prior to the present audit or investigation by the department and the application for ICEC is pending determination by the department;

(b) the worker provided the hiring agent a forged ICEC;

(c) the hiring agent took affirmative steps to verify the worker's independent contractor status, verified the worker to be an independent contractor by holding an independent contractor exemption certificate, and has documentation of the same; or

(d) the ICEC expires during the working relationship which is at issue in the present claim for workers' compensation or unemployment insurance benefits or audit or investigation by the department.

(1) Unless appealed following mediation per 39-71-415, MCA, ICCU decisions are binding on all parties regarding employment status issues under the jurisdiction of the department and any other agency electing to be included as a member of the ICCU. These decisions may affect a party's liability in unemployment insurance, the Uninsured Employer's Fund, wage and hour, human rights, and state income tax withholding matters.

(2) Neither the department nor any other agency electing to be included as a member of the ICCU may appeal the ICCU's employment status decision.

(3) When a party appeals the ICCU's employment status decision, the decision is not binding on any party until all appeal rights are exhausted.

(1) A party receiving an adverse ICCU decision may request mediation within 15 days of the date the decision was sent. The mediation request is effective upon department receipt.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

This rule has been repealed.

(1) An individual is an employee and not an independent contractor if the hiring agent controls or retains the right to control the way the individual renders services. The following factors serve as general guidelines when the department evaluates whether control exists:

(a) the individual is required to follow written or oral instructions concerning when, where, or how work is to be done. Although some individuals, because of skill or expertise, work without receiving instructions, they may still be employees if the employer has the right to give instructions on work performance;

(b) the success or continuation of a business depends in great part upon the services performed by the individual;

(c) the hiring agent directs the hiring, supervising, or payment of the individuals assistants;

(d) the relationship between the individual and the hiring agent is on a frequent, recurring basis, even if irregular or part time;

(e) the individual is required to perform services at certain established times;

(f) the work is performed on the business premises or jobsite of the hiring agent. This factor is especially important if the work could be performed elsewhere;

(g) the hiring agent requires, or has the right to require, the individual to perform services in a certain manner, or in a certain order or sequence;

(h) the hiring agent requires the individual to submit oral or written reports;

(i) the individual is paid based on the time spent doing the work rather than a payment for a completed project or end result;

(j) the individual is paid or reimbursed for travel or other business-related expenses;

(k) the hiring agent furnishes the facilities, tools, materials, or other equipment to the individual;

(l) the individual may be discharged at the will of the hiring agent, including the right to discharge for the failure to follow specified rules or methods. A union contract or statute which restricts the right of discharge does not indicate a lack of control;

(m) training is provided to the individual by the hiring agent;

(n) the individual does not realize a profit or suffer a loss as a result of the services performed;

(o) the individual is prohibited or restricted from working for others or is required to devote primary attention to the hiring agent;

(p) the individual has signed an overly broad noncompetition clause in a contract with a hiring agent; or

(q) other factors that indicate control of the individual by the hiring agent.

(2) The above factors are weighed and evaluated depending on the circumstance of each case. A combination of these factors may indicate control or the right to control. Service performed by an individual for pay is considered to be employment until it is shown to the satisfaction of the department that the individual is an independent contractor.

(1) To be an independent contractor, an individual must be engaged in an independently established trade, occupation, profession, or business. The following factors serve as general guidelines when the department evaluates whether an independently established business exists:

(a) the individual has a place of business separate from the hiring agent's place of business;

(b) the individual supplies substantially all of the tools, equipment, supplies, or materials necessary to perform the services;

(c) the individual pays all expenses associated with performing the services, and is not reimbursed by the hiring agent;

(d) the individual has two or more effective contracts to perform services for several different hiring agents;

(e) the individual is paid based on a billing statement or invoice at completion of the services;

(f) the individual performs the services under a written contract that requires complete or partial payment after a certain amount of work is performed, and the contract terminates after a definite time period;

(g) the individual advertises services in telephone books, newspapers, or other media;

(h) the individual files federal or state business tax forms;

(i) the individual has the required customary licenses, registrations, or permits to maintain a business;

(j) the individual may realize a profit or suffer a loss from performing the services for the hiring agent. This factor may be shown if the individual:

(i) hires or pays assistants to perform the services;

(ii) performs the services at facilities owned or leased by the individual;

(iii) has continuing or recurring liabilities associated with performing the services; or

(iv) agrees to perform specific jobs for prices agreed upon in advance and pays expenses associated with the performance of the services;

(k) the individual has an independent contractor exemption certificate;

(l) the individual may not end the relationship at will without incurring liability. An independent contractor agrees to complete a specific job, is responsible for its completion, and may be subject to liability for failing to complete the job in accordance with agreed upon specification;

(m) the individual is not prohibited or restricted from working for others; or

(n) another factor that indicates the existence of an independently established trade, occupation, profession, or business.

(2) The department shall evaluate and weigh the above factors for each case. A combination of these factors may indicate that the individual is customarily engaged in an independently established trade, occupation, profession, or business. Service performed by an individual for pay is considered to be employment until it is shown to the satisfaction of the department that the individual is an independent contractor.