House Bill 704

AN ACT TO REQUIRE A CONTRACTOR WHO SUBMITS A BID ON A PUBLIC PROJECT UNDER THE BIDDING LAWS OF THIS STATE TO HAVE A STATE TAX IDENTIFICATION NUMBER AND WORKERS' COMPENSATION INSURANCE WHICH COVERS ALL EMPLOYEES OF THE CONTRACTOR; TO REQUIRE THE CONTRACTOR TO SHOW PROOF OF SUCH REQUIRED DOCUMENTS UPON REQUEST; TO PROVIDE PENALTIES FOR THOSE WHO FAIL TO POSSESS SUCH DOCUMENTS; TO PROVIDE FINES FOR THOSE WHO MISCLASSIFY EMPLOYEES FOR PURPOSES OF AFFECTING PROCEDURES AND PAYMENTS UNDER WORKERS' COMPENSATION OR UNEMPLOYMENT INSURANCE; TO REQUIRE CERTAIN AGENCIES TO WORK TOGETHER TO INVESTIGATE VIOLATIONS OF THIS ACT; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) Any contractor who submits a bid on a public project under the bidding laws of this state shall have a state tax identification number and workers' compensation insurance which covers all employees of the contractor. Any contractor who submits a bid on a public project under the bidding laws of this state shall show, upon request, proof of a state tax identification number and workers' compensation insurance that covers all employees of the contractor.

(2) Any person who fails to possess or show proof upon request of the information described in subsection (1) shall be fined by the Mississippi Department of Revenue in an amount not to exceed ten percent (10%) of the contractor's total bid, which amount shall be in addition to any other penalties authorized by law.

(3) Any contractor that intentionally misclassifies individuals as independent contractors rather than employees, for the purpose of affecting withholding, social security, unemployment tax or workers' compensation insurance premium payments, shall be fined by the Department of Revenue in an amount not to exceed ten percent (10%) of the contractor's total bid, which amount shall be in addition to any other penalties authorized by law.

SECTION 2. The Mississippi Department of Revenue, the Department of Employment Security and the Workers' Compensation Commission shall share information and coordinate investigative and enforcement efforts for the purpose of detecting those contractors who intentionally misclassify individuals as independent contractors rather than employees for the purpose of affecting procedures and payments relating to withholding and social security, unemployment tax or workers' compensation insurance premium. The agencies described in this section shall create a secure database of information accessible by agency representatives responsible for enforcement and shall be further authorized to enter into contracts and interagency agreements and promulgate such rules as may be necessary to implement this section.

SECTION 3. This act shall take effect and be in force from and after its passage.