AB946: Bill Text

2003 Assembly BILL 946

March 11, 2004 - Introduced by Representatives Schooff, Black, Molepske, Albers, J. Lehman, Townsend, Gunderson, Berceau and Taylor, cosponsored by Senators Erpenbach, Kanavas, Robson, Carpenter and Hansen. Referred to Committee on Rules.

AB946,1,4 An Act to amend 21.72 (1) (a) 10., 49.857 (1) (d) 10., 73.0301 (1) (d) 3m., 103.005 (10), 111.322 (2m) (a) and 111.322 (2m) (b); and to create 103.34 of the statutes; relating to: the regulation of traveling sales crews, requiring the exercise of rule-making authority, and providing penalties.

Analysis by the Legislative Reference Bureau

Current law

House-to-house employment of minors

Under current law, no person may employ, offer to employ, or recruit a minor to sell goods or services from house-to-house (house-to-house street trades) without obtaining a house-to-house employer certificate from the Department of Workforce Development (DWD). A person may obtain a house-to-house employer certificate by submitting an application to DWD that contains certain information required under current law, including documentation proving that the person has the ability to pay any compensation owed to a minor employee, which proof may be in the form of a bond, certificate of deposit, escrow account, or irrevocable letter of credit in an amount of at least $5,000 (proof of financial responsibility). If the applicant establishes proof of financial responsibility and if DWD is satisfied that the applicant will comply with the laws relating to house-to-house street trades, DWD must issue a house-to-house employer certificate, which is valid for a 12-month period.

When a minor applies for a job in house-to-house street trades, the house-to-house employer must inform the minor in writing of the terms and conditions of employment, including the compensation to be paid, the time and manner of payment of compensation, the number of days per week and hours per day that the minor would be required to conduct house-to-house street trades, the nature and frequency of required employment-related meetings and how compensation is paid for attendance at those meetings, whether and how the employer provides transportation, and the expenses that the minor would be required to pay. A house-to-house employer may change those terms and conditions by a supplemental document in writing, if the change applies prospectively only.

DWD may suspend or revoke a house-to-house employer certificate if the employer submits false information in the application, fails to notify DWD of any change in that information within 30 days after the change occurs, fails to comply with the terms and conditions of a written disclosure statement, fails to maintain proof of financial responsibility, or fails to comply with the laws relating to house-to-house street trades.

The bill

Traveling sales crews

Certificate of registration

This bill regulates traveling sales crews, which the bill defines as two or more individuals who are employed as salespersons or in related support work, who travel together in a group, and who are absent overnight from their permanent residences for the purpose of selling goods or services to consumers from house to house, on any street or in any other place that is open to the public.

Specifically, under the bill, a person may not employ, offer to employ, or otherwise recruit an individual to work as a traveling sales crew worker without first obtaining a certificate of registration from DWD. A person may obtain a certificate of registration by completing an application, meeting the minimum requirements under the bill and under rules promulgated by DWD for issuance of a certificate of registration, and paying a registration fee determined by DWD by rule. The application must contain certain information specified in the bill, including all of the following:

1. The name, address, and telephone number of the applicant and, if the applicant is engaged in sales activities on behalf of a principal, the name, address, and telephone number of the principal.

2. The names and permanent home addresses of all proprietors, managing partners, managers, or principal officers of the applicant, proof of identification of those individuals, and information relating to the conviction records of those individuals.

3. The names, permanent home addresses, motor vehicle operator's license numbers, and dates of birth of all employees, agents, or representatives of the applicant who supervise or transport traveling sales crews, proof of identification of those individuals, and information relating to the conviction records of those individuals.

4. The type of sales activities to be performed and the nature of the goods or services to be sold.

5. A statement identifying each motor vehicle that will be used to transport traveling sales crew workers and documentation showing that each motor vehicle complies with all state and federal safety standards applicable to the motor vehicle.

6. A statement indicating whether the duties of the traveling sales crew workers of the applicant will include the storage, handling, or transportation of hazardous materials or may result in any other exposure of the traveling sales crew workers to hazardous materials and, if so, documentation showing that the applicant is in compliance with all state and federal safety standards applicable to the storage, handling, and transportation of the hazardous materials.

7. Documentation that the applicant has complied with the proof of financial responsibility, written disclosure statement, and proof of insurance requirements under the bill.

On receipt of an application, DWD must investigate to determine whether the applicant is qualified to receive a certificate of registration. That investigation must include a criminal history search of all proprietors, managing partners, managers, or principal officers of the applicant and of all employees, agents, or representatives of the applicant who supervise or transport traveling sales crew workers. After completing the investigation, DWD must issue a certificate of registration, which is valid for a 12-month period, if the applicant meets the minimum requirements for issuance of a certificate of registration and DWD is satisfied that the applicant will comply with the bill and rules promulgated under the bill.

DWD may deny, suspend, revoke, restrict, or refuse to renew a certificate of registration if any of the following apply:

1. The applicant or registrant is not the real party in interest with respect to the application or certificate of registration, and the real party in interest has been denied issuance or renewal of a certificate of registration, has had a certificate of registration suspended, revoked, or restricted, or is not qualified to receive a certificate of registration.

2. A proprietor, managing partner, manager, or principal officer of the applicant or an employee, agent, or representative of the applicant who supervises or transports traveling sales crew workers has been convicted of a disqualifying offense, as defined in the bill, within the five years preceding the date of the application. Generally, a disqualifying offense under the bill includes certain offenses relating to drugs or alcohol, if committed in connection with or incident to any traveling sales crew activities; certain crimes involving misappropriation of property, if the value of the property misappropriated is $2,500 or more; and certain crimes against life or bodily security, such as homicide, assault, or sexual assault, certain crimes involving damage to or trespass against property, such as arson or burglary, certain crimes involving prostitution, and certain crimes against children.

3. The applicant or registrant has made a material misrepresentation or false statement in the application.

4. The applicant or registrant has failed to notify DWD of any change in the information submitted in the application within 30 days after the change occurs.

5. The applicant or registrant has failed to maintain proof of financial responsibility as required under the bill, failed to comply with the written disclosure statement requirements under the bill, failed to pay wages as required under the bill, failed to maintain insurance coverage as required under the bill, engaged in a practice prohibited under the bill, employed a traveling sales crew worker without a permit, or otherwise failed to comply with the bill or any rules promulgated under the bill.

Employer requirements

The bill requires an applicant for a certificate of registration to establish proof of its ability to pay any compensation owed to a traveling sales crew worker, which proof may be in the form of a bond, certificate of deposit, escrow account, or irrevocable letter of credit in an amount approved by DWD, but not less than $10,000.

The bill requires an employer to provide an individual who is offered employment as a traveling sales crew worker with a written disclosure statement of the terms of employment. The written disclosure statement must include all of the following information:

1. The place or places of employment, stated with as much specificity as possible.

2. The compensation to be paid.

3. The type or types of work on which the individual may be employed.

4. The pay period and the manner in which compensation will be paid.

5. The number of days per week and hours per day the individual may be required to engage in sales activities or related support work.

6. The nature and frequency of any employment-related meetings that the individual may be required to attend, the time of day of those meetings, and how compensation is paid for attendance at those meetings.

7. The period of employment, including the approximate beginning and ending dates of employment.

8. A description of the board, lodging, and other facilities to be provided and any costs to be charged to the individual for those facilities.

9. A description of the transportation to be provided and, if the employment will involve the storage, handling, or transportation of a hazardous material or may result in any other exposure to hazardous materials, a description of the hazardous materials.

10. Whether worker's compensation is provided.

The bill also requires an employer of a traveling sales crew worker to do all of the following:

1. Pay all compensation earned by the worker in U.S. currency or by check or draft on regular paydays designated in advance, but in no case less often than semimonthly; to provide with each payment a written statement itemizing gross pay, net pay, and the amount of and reason for each deduction from gross pay; and to keep records of that information for three years after the worker leaves the employ of the employer.

2. Maintain and operate any motor vehicle used to transport traveling sales crews in compliance with all state and federal safety standards that are applicable to the motor vehicle, including any additional safety standards relating specifically to the transportation of sales crews prescribed by DWD by rule.

3. If the duties of a traveling sales crew worker will involve the storage, handling, or transportation of hazardous materials or might otherwise result in exposure of the traveling sales crew worker to hazardous materials, ensure that the hazardous materials are stored, handled, and transported, and that the worker is trained in the storage, handling, and transportation of hazardous materials, in compliance with all state and federal safety standards that are applicable to the hazardous materials, including any additional safety standards relating specifically to the storage, handling, and transportation of hazardous materials by traveling sales crews prescribed by DWD by rule.

4. Have in force a motor vehicle liability insurance policy and an insurance policy covering the negligent acts or omissions of the employer and the employer's employees, agents, and representatives and, if required to do so under the worker's compensation law, provide worker's compensation coverage. (Generally, an employer is required to provide worker's compensation coverage if the employer employs three or more employees or pays wages of $500 or more in any calendar quarter.)

Prohibited practices

The bill prohibits an employer and any employee, agent, or representative of an employer who supervises or transports traveling sales crew workers from doing any of the following:

1. Employing a minor as a traveling sales crew worker an adult who has been adjudged incompetent without the permission of the person's guardian or employing a minor as a traveling sales crew worker.

2. Requiring a traveling sales crew worker to engage in any in-person sales or solicitation activities before 9:00 a.m. or after 9:00 p.m.

3. Considering a traveling sales crew worker to be an independent contractor rather than an employee.

4. Requiring a traveling sales crew worker to purchase any goods or services solely from the employer or to pay any of the employer's business expenses, except that an employer may deduct from a worker's compensation the cost of furnishing board, lodging, or other facilities if those facilities are customarily furnished to the employer's traveling sales crew workers; the amount deducted does not exceed the fair market value of those facilities and does not include any profit to the employer; and the traveling sales crew worker has previously authorized the deduction in the written disclosure statement.

5. Abandoning a traveling sales crew worker who is unable to work due to illness or injury or who is discharged from employment for reasons other than misconduct without providing for the return of the traveling sales crew worker to his or her permanent place of residence.

6. Abandoning a traveling sales crew worker who has been arrested and is being held in custody in connection with a violation of the bill or a local ordinance regulating the conduct regulated by the bill.

7. Requiring a traveling sales crew worker to relinquish custody of any of his or her personal property to the employer, to any employee, agent, or representative of the employer who supervises or transports traveling sales crew workers, or to any other traveling sales crew worker of the employer.

8. Prohibiting or restricting a traveling sales crew worker from contacting any family member, friend, or other person while traveling with the traveling sales crew.

9. Intentionally inflicting or threatening to inflict any bodily harm on a traveling sales crew worker or damage to the property of a traveling sales crew worker as a means of discipline or motivation.

10. Advising or counseling a traveling sales crew worker to make false representations to a person to whom he or she is offering goods or services concerning his or her motivation for selling those goods or services.

11. Discharging or discriminating against any person for opposing any practice prohibited under the bill.

Traveling sales crew worker permits

The bill prohibits an individual from being employed or permitted to work as a traveling sales crew worker unless the employer of the individual first obtains from DWD a traveling sales crew worker permit (permit) for the individual and the individual first obtains from DWD an identification card. The bill requires the permit and identification card to include at a minimum the name and permanent home address of the traveling sales crew worker and the name, address, and phone number of his or her employer.

The bill also requires an employer of a traveling sales crew worker and all employees, agents, or representatives of that employer who supervise or transport traveling sales crew workers to carry at all times while engaged in traveling sales crew activities a copy of the permit obtained for each traveling sales crew worker of the employer and a traveling sales crew worker to carry at all times while engaged in traveling sales crew activities a copy of the identification card.

In addition, the bill requires a traveling sales crew employer to keep a copy of the permit for each traveling sales crew worker of the employer for at least three years after the traveling sales crew worker leaves the employ of the employer, to keep a list of the names of all cities, villages, or towns where traveling sales crew workers of the employer engaged in traveling sales crew activities within the last three years, and at the request of DWD, to provide a list of all cities, villages, or towns where the employer intends to employ traveling sales crews in traveling sales crew activities for the six-month period beginning on the date of the request.

Under the bill, before an employer may permit a traveling sales crew worker of the employer to engage in traveling sales crew activities in any city, village, or town, the employer shall obtain from the clerk of the city, village, or town a stamp or endorsement on the permit of the traveling sales crew worker. The bill requires an employer who obtains that stamp or endorsement to provide notice to local law enforcement authorities that traveling sales crew workers of the employer will be engaging in traveling sales crew activities in that city, village, or town.

The bill also requires law enforcement officers of counties, cities, villages, and towns to assist DWD in enforcing the bill by questioning individuals seen engaging in traveling sales crew activities and reporting to DWD all cases of individuals apparently engaging in traveling sales crew activities in violation of the bill.

Nonapplicability and nonpreemption

Finally, the bill does not apply to fund-raising sales by a nonprofit organization or school and does not preempt a county, city, village, or town from enacting a local ordinance regulating the sale of goods or services to consumers from house to house, on any street, or in any other place that is open to the public.

Because this bill creates a new crime or revises a penalty for an existing crime, the Joint Review Committee on Criminal Penalties may be requested to prepare a report concerning the proposed penalty and the costs or savings that are likely to result if the bill is enacted.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB946, s. 1 Section 1. 21.72 (1) (a) 10. of the statutes is amended to read:

AB946,7,2 21.72 (1) (a) 10. A certificate issued under s. 103.275, 103.34, 103.91, or 103.92.

AB946, s. 2 Section 2. 49.857 (1) (d) 10. of the statutes is amended to read:

AB946,7,5 49.857 (1) (d) 10. A certificate issued under s. 103.275, 103.34, 103.91, or 103.92.

AB946, s. 3 Section 3. 73.0301 (1) (d) 3m. of the statutes is amended to read:

AB946,7,9 73.0301 (1) (d) 3m. A license or certificate issued by the department of workforce development under s. 102.17 (1) (c), 103.275 (2) (b), 103.34 (3) (c), 103.91 (1), 103.92 (3), 104.07 (1) or (2), or 105.13 (1).

AB946, s. 4 Section 4. 103.005 (10) of the statutes is amended to read:

AB946,7,14 103.005 (10) Except as provided in ss. 103.275 (2) (bm) and (br), 103.34 (10) (b) and (c), 103.91 (4) (b) and (c), 103.92 (6) and (7), 104.07 (5) and (6), and 105.13 (2) and (3), orders of the department under chs. 103 to 106 shall be subject to review in the manner provided in ch. 227.

AB946, s. 5 Section 5. 103.34 of the statutes is created to read:

AB946,8,2 103.34 Regulation of traveling sales crews. (1) Definitions: In this section:

AB946,8,4 (a) "Certificate of registration" means a certificate of registration issued under this section authorizing a person to employ traveling sales crew workers.

AB946,8,5 (b) "Disqualifying offense" means any of the following:

AB946,8,9 1. A violation of s. 125.07 (1) (a), (2) (a) 1. or 2., or (4) (a) or (b), 125.085 (3) (a) or (b), 125.09 (2), 961.41 (1) or (1m), 961.573 (2), 961.574 (2), or 961.575 (2) or of a substantially similar federal law or law of another state, if the violation was committed in connection with or incident to any traveling sales crew activities.

AB946,8,16 2. A violation of s. 940.01, 940.02, 940.03, 940.05, 940.06, 940.07, 940.08. 940.09, 940.10, 940.19 (2), (4), (5), or (6), 940.21, 940.225 (1), (2), or (3), 940.23, 940.24, 940.25, 940.30, 940.305, 940.31, 943.02, 943.03, 943.04, 943.10, 943.30, 943.31, 943.32, 944.32, 944.33 (2), 944.34, 946.10, 948.02 (1) or (2), 948.025, 948.03 (2) or (3), 948.04, 948.05, 948.055, 948.06, 948.07, 948.075, 948.08, 948.11 (2) (a) or (am), 948.12, 948.13, 948.21 (1), or 948.30 or of a substantially similar federal law or law of another state.

AB946,8,19 3. A violation of s. 943.20, 943.201, 943.21, 943.23, 943.24 (2), 943.34, 943.50, 943.61, 943.62, or 943.70 or of a substantially similar federal law or law of another state, if the value of the property misappropriated is $2,500 or more.

AB946,8,20 (c) "Hazardous materials" has the meaning given in 49 USC 5102 (2).