Worker Flexibility and Choice Act

To provide workers with schedule flexibility and choice, and for other purposes. 1. Short title This Act may be cited as the Worker Flexibility and Choice Act 2. Worker flexibility agreements Section 3 of the Fair Labor Standards Act of 1938 ( 29 U.S.C. 203 (1) in subsection (e), by adding at the end the following: (6) (A) Except as provided in subparagraph (B), the term employee (B) For the purposes of sections 3(l), 12, and 13(c), and paragraphs (3) and (4) of section 15(a), the term employee ; and (2) by adding at the end the following: (z) (1) Worker flexibility agreement The term worker flexibility agreement (A) that is knowingly and voluntarily entered into by an entity and an individual before work begins, in accordance with paragraph (2); (B) under which— (i) the individual retains the rights provided to employees in connection with other workplace laws, including those relating to individual employee privacy rights, nondiscrimination, nonharassment, nonretaliation, safety, and leave under the Family and Medical Leave Act, in accordance with applicable laws; (ii) the individual retains the freedom and flexibility to reject offers the entity provides to the individual to provide services or results without negatively impacting the individual’s opportunity to provide services to the entity in the future during the arrangement's term; and (iii) the individual retains the right to perform the same services or results as the services or results provided under the arrangement to competing businesses, unless part of a bargained-for non-solicitation sales agreement; (C) that specifies that the individual entering into the agreement— (i) will not be treated as an employee for Federal tax purposes with respect to services performed pursuant to the agreement during the period during which the agreement is in effect; and (ii) has not been treated as an employee for Federal tax purposes with respect to the same or similar services performed at any time during the calendar year in which such agreement is entered into by the individual and the entity; (D) that may include other requirements, if agreed to by the individual and the entity; (E) that is affirmed in writing and that— (i) states the entity has offered, and the individual has chosen to enter into, an arrangement whereby the individual is not subject to the minimum wage and overtime protections of this Act and is not treated as an employee under the Internal Revenue Code of 1986 (and related State and local laws); and (ii) includes a statement of all of the rights and requirements described subparagraphs (B) and (C); and (F) that is for a defined period of time and that may be renewed or renegotiated by the individual and the entity following its expiration in accordance with the requirements of this section. (2) Knowing and voluntary agreement For the purposes of this subsection, an agreement described in paragraph (1) shall not be considered to be entered into knowingly and voluntarily unless the agreement— (A) is written in plain language in a manner that can be understood by the average individual eligible to participate; (B) specifically refers to rights or claims under this Act; (C) advises the individual in writing of their right to consult with others, including an attorney, prior to signing the agreement; (D) confirms that the individual has been provided with a written summary of health, pensions, insurance (including accident or other occupational health products), training, and certification programs, or other benefits, if any, that the individual is eligible for while the agreement is in effect; and (E) includes the signature of the individual and a representative of the entity. . 3. Supersedure and validity Section 18 of the Fair Labor Standards Act of 1938 ( 29 U.S.C. 218 (c) Supersedure and validity of worker flexibility agreements (1) In general Except as otherwise provided in paragraph (2), with respect to any individual who has entered into a worker flexibility agreement, the requirements of subsections (e)(6) and (z) of section 3 shall supersede all Federal, State, and local laws relating to wages and other monies paid, hours worked, documentation and recordkeeping, and applicable taxes, benefits, and contributions insofar as they may apply to the employment relationship between the individual and the entity covered under the worker flexibility agreement. (2) Revocation A worker flexibility agreement shall be valid, irrevocable, and enforceable, except upon such grounds as exist at law or equity for the revocation of any contract. . 4. Amendments to the Internal Revenue Code of 1986 and ERISA (a) Treatment under Internal Revenue Code of 1986 (1) In general Chapter 25 3508A. Treatment of services performed under worker flexibility agreements (a) General rule For purposes of this title, in the case of services performed pursuant to a worker flexibility agreement— (1) the individual performing such services shall not be treated as an employee; and (2) the person for whom such services are performed shall not be treated as an employer. (b) Worker flexibility agreement For purposes of this section, the term worker flexibility agreement 29 U.S.C. 203(z) . (2) Clerical amendment The table of sections for chapter 25 of such Code is amended by inserting after the item relating to section 3508 the following new item: Sec. 3508A. Treatment of services performed under worker flexibility agreements. . (b) ERISA Section 3(40)(A) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1002(40)(A) (1) in clause (ii), by striking or (2) in clause (iii), by striking the period and inserting , and (3) by adding at the end the following: (iv) by an entity for individuals who have entered into a worker flexibility agreement, as defined in section 3(z) of the Fair Labor Standards Act of 1938 ( 29 U.S.C. 203(z) .

Summary: Worker Flexibility and Choice Act This bill allows employers to offer prospective workers flexibility arrangements that the individual may voluntarily enter before work begins. Under such an arrangement, a worker generally would not be considered an employee under the Fair Labor Standards Act of 1938 or the Internal Revenue Code of 1986.