Senate committee substitute makes the following changes to the 1st edition.

Amends proposed GS Chapter 143, Article 81, the Employee Fair Classification Act, making technical and clarifying changes to the definitions section for the Article. Amends the name of the newly established division to the Employee Classification Division (was, Employee Misclassification Division). Makes conforming changes.  Amends the factors that are considered when determining if an individual is an independent contractor. Adds language that provides that factors consistent with the holding of Hayes v. Board of Trustees of Elon College can be considered in making an independent contractor determination. Provides that there is a right to a hearing by the Industrial Commission in regards to any penalties assessed (was, a right to a hearing by the Office of Administrative Hearings). Provides that the State Licensing Board for General Contractors has the power to refuse to issue or renew as well as revoke, suspend, or restrict licenses and assess other disciplinary action concerning general contractors if a penalty has been imposed pursuant to GS 143-765(b) and upheld on final adjudication (previously, had such authority when general contractors were found to have engaged in employee misclassification in violation of GS Chapter 143, Article 81). Amends GS 143-59.2(a) to provide that vendors cannot enter into contracts for goods and services with any state government entity if, within five years prior to the date of bid solicitation, the vendor has been assessed a civil penalty pursuant to GS 143-765(b) (was, cannot enter into contracts if assessed a civil penalty for violating employee misclassification regulations) within the five years prior to any bid solicitation. Amends proposed language for GS 153A-134, 160A-194, 153A-360, and 160A-420, making clarifying changes. Amends GS 96-1(b)(12) concerning the definition of employment for the purposes of the Employment Security Law, making clarifying changes and adding that service, as specified, involving delivery or distribution of newspapers or shopping news or the sale of newspapers or magazines is considered employment.