California AB 1897
The upcoming effects of California AB 1897 caught me slightly by surprise. Many states had discussed laws that reinforced the ladder of insurance. This new statute addressed it directly.
I tried to blog live on many of the sessions at the NWCDC in Las Vegas last week. However, internet connectivity, power plugs, etc. made it a little tough in a few instances. I wrote this session out by hand. It was one of the most important ones for employers, especially California employers.
Many states are passing laws currently that make temporary agencies and client-employers equally responsible for providing Workers Compensation benefits for an injured employee. These types of laws will quickly erode the hallmark of the temporary agency being the responsible party for their workers’ benefits resulting from a WC accident.
As I have pointed out very often in this blog, California will usually be the first state at enacting rules and laws that will be coming to your state(s) very soon.
California AB 1897 seems to be one of the first of its kind. California AB 1897 does not let the employer off the hook for Workers Compensation benefits for temporary employees that were hired through an agency.
Some of the important aspects of the new law are:
- Effective January 1st, 2015
- One of the exceptions were key employees such as executive temps.
- Temporary agency, PEO, or leasing employer cannot be self insured
- All parties are equally responsible for employee safety
- Some of the exclusions are:
- Small business – 25 or less employees
- Business facility with 5 or less temporary workers
- Local government
The presenters, who I will add into this article or add in a completely different article, recommended that the temporary agency contracts need to be reviewed very extensively as to the responsible party for WC benefits for an injured temporary worker.
This was one of the sessions that should have been given some attention with the advent of co-responsibility between employer and temp agency. You may want to check the upcoming employment law changes in your state as the presenters had acknowledged other states were considering similar law changes to California AB 1897.
Article provided by James J Moore, AIC, MBA, ChFC, ARM. All articles are original content. Check out the full website at www.cutcompcosts.com