PIANY Hails Passage of Producer Contract Law

The Professional Insurance Agents of New York Inc. (PIANY) praised a bill recently signed into law by Gov. George Pataki

The new law, formerly A.6167, sets guidelines for drawing up contracts with insurance producers that will clearly identify the producers as independent contractors for purposes of New York’s workers’ compensation and unemployment insurance systems.

David Isenberg, President of PIANY, said, “Real estate agencies have had similar guidelines in place for some time. But insurance agencies and brokerages have not enjoyed the same legal clarity when they engage in business relationships with insurance producers that are not intended or considered by either party to be employment relationships.”

PIANY has worked over the years to achieve greater clarity in the complex issue of identifying independent contractors as distinct from employees, in all areas, Isenberg said. “Insurance producers often face conflicting views between the businesses they insure and the insurance companies that write workers’ compensation coverage about whether a given individual is an employee,” he said. “Now, at least in our own offices, there will be objective criteria we can rely on.”

The law excludes from the definitions of “employment” and “employee” insurance producers who enter into written contracts containing certain conditions and who are compensated based on sales rather than hours worked.