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the firm hires and pays its own employees and reports their income to the IRS; and whether firm
personnel represent themselves to be employees of the contractor. Failing any one of those tests
apparently means there is not a legitimate proprietorship or partnership and that all of items
(1)-(3) must be met.
Before this statute, whether an individual working for a construction contractor was an employee
or an independent contractor was determined according to the common law. Under the common-law
approach, courts on a case-by-case basis considered several factors, such as the right to control, the
skill involved in the work, the method of payment, the work schedule, the right to discharge, who
provided tools, materials and equipment, whether the worker’s occupation was related to that of the
employer, and who paid for insurance, social security and taxes. See Wheaton v. Suwana, 355
Ill.App.3d 506, 823 N.E.2d 993. Under the common-law approach, no single factor was deter-
minative, although the right to control the work was the most important. Wenholdt v. Industrial
Com’n, 95 Ill.2d 76, 447 N.E.2d 404 (1983).
The Act can be expected to increase findings that workers are employees. This is so because
the Act starts out with a presumption in favor of employee status, because failing any one factor
apparently is fatal on the “sole proprietorship or partnership” test, and because failing any one of the
§ 10(b)(1)-(3) factors results in a finding of employee status.
The Act applies only to the construction industry. Hence, the common-law approach will
continue to apply to other industries, and the Act may be subject to a challenge as special
legislation. The Illinois Constitution provides that the legislature may “pass no special or local law
when a general law is or can be made applicable.” This prohibits the legislature from conferring a
special benefit or privilege on one group and excluding others similarly situated. General Motors
Corp. v. State Motor Vehicle Review Bd., 224 Ill.2d 1, 862 N.E.2d 209
(2007). A special-legislation inquiry looks first at whether the statute
discriminates in favor of a select group, and if it does, then at whether
the classification is arbitrary. Not only does this Act apply only to one
industry, its scope is further limited by its definitions of “construction” and
“performing services.” The first prong of a special-legislation challenge
appears to be met.

The legislative record evidences three reasons for adopting the
Act: (1) construction contractors who classify workers as independent
contractors are able to underbid other contractors; (2) construction
employees lose benefits, rights and protections under State and Federal
law by being treated as independent contractors; and (3) the State loses millions of dollars in income
taxes which are more difficult to collect from non-employees. Item (3) clearly applies to all industries,
but it is arguable that item (1) is especially associated with the construction industry, and that due to
the dangers and seasonal nature of construction work, making sure workers are covered by unem-
ployment and worker compensation insurance (item (2)) is especially important in that industry. To
date, however, the courts have not considered whether those reasons would save the Act from a
constitutional challenge as being arbitrary.
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