Illinois Administrative Code › Title 56 - LABOR AND EMPLOYMENT › Part 2732 - EMPLOYMENT › Subpart B - SERVICES IN EMPLOYMENT › Section 2732.227 - Exemption for the Delivery or Distribution of Newspaper or Shopping News to the Ultimate Consumer

Current through Register Vol. 48, No. 28, July 12, 2024
a) For the
				purpose of applying Section 225(C) of the Act:
1) The "substantially all the remuneration"
				requirement is satisfied if at least 75% of the total remuneration received by
				the individual for the calendar quarter from the employing unit claiming the
				exemption is directly related to sales, "per piece" fees, or other output
				rather than to the number of hours worked. A "base fee" or other payment
				provided as a reasonable reimbursement for mileage and other expenses will not
				be included in calculating whether the requirement is met.
EXAMPLE 1: An individual's compensation consists of $.05 for
				  each newspaper that he delivers and a base fee of $50.00 per week. The
				  individual's weekly mileage expense is approximately $25.00 and his other
				  expenses total approximately $10.00. The base fee is a reasonable reimbursement
				  for mileage and other expenses. Therefore, since the base fee is not considered
				  regardless of the number of newspapers delivered, 100%, therefore,
				  "substantially all" of the individual's remuneration is directly related to
				  output.
EXAMPLE 2: An individual's compensation consists of $.05 for
				  each newspaper that he delivers and a flat fee of $100.00 per week. The
				  individual's weekly mileage expense is approximately $20.00 and his other
				  expenses total approximately $7.00. The fee is not a reasonable reimbursement
				  for mileage and other expenses. The difference between the fee and the actual
				  expenses is included in determining whether the "substantially all the
				  remuneration" requirement is met. The individual's output based remuneration
				  would have to be at least 75% of the individual's total pay for the exemption
				  to apply.
2) The "written
				contract" requirement is not met unless the contract specifically states that
				the individual will not be treated as an employee for federal tax purposes. It
				will not be sufficient for the contract to merely state that the individual
				will not be treated as an employee. Any services provided prior to the date of
				the execution of the required written contract shall not be exempt under
				Section 225(C) of the Act; whether these services constituted employment under
				the Act shall be determined under Section 212 of the Act.
3) Delivery or distribution to the "ultimate
				consumer" does not include the delivery or distribution for sale or resale,
				including but not limited to distribution to a newsrack or newsbox,
				salesperson, newstand or retail establishment. Delivery or distribution to the
				"ultimate consumer" does not include the distribution for further distribution
				regardless of subsequent sale or resale.
EXAMPLE 1: Delivery of a single newspaper to a restaurant
				  owner who allows his customers to read the paper is delivery to the ultimate
				  consumer.
EXAMPLE 2: Delivery of several copies of a newspaper to a
				  restaurant which provides a complimentary morning newspaper for its customers
				  is not delivery to the ultimate consumer.