Clarifies Status of Direct Sellers



The Business Council of New York State, Inc., an organization representing over 3,000 member companies, chambers of commerce, and regional associations, has reviewed the aforementioned legislation and supports its enactment.

Bill Summary: This legislation amends Section 511 of the New York Labor Law to bring clarity to the status of direct sellers for unemployment compensation purposes. In New York State and in the other 49 states, direct sellers are considered independent contractors. There are currently, thirty-two other states that exempt direct sellers from unemployment compensation laws based on their status as a "non-employee" independent contractors. In addition, Congress enacted the Tax Equity and Fiscal Responsibility Act, in 1982, which among other things, states that for federal employment tax purposes, direct sellers are "non-employee" independent contractors. This legislation would bring clarity and consistency to the status of direct sellers, such as Amway and Avon distributors, by statutorily exempting them from New York's unemployment compensation laws. For this reason, The Business Council supports this legislation and encourages its enactment.