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PIANH 2007 legislative wrap-up
By Jill Muratori, Esq.
The Legislature recessed at the end of June after spending the last six months meeting in Concord . It was an historic session with democrat majorities in all branches of government for the first time since 1874. Topping the list of noteworthy new laws are several that deal with workers' compensation issues.
Workers' compensation exclusions/certification . Effective Sept. 14, 2007, H.B. 471 changes the current rule for excluding up to three executive officers of a corporation or members of an LLC from workers' compensation coverage. The law amends the exclusion so that it would not apply to any individual who actively is engaged in on-site work on any construction site in the state. The law also requires contractors for state transportation, public work or major products to provide:
- a certificate of insurance of current workers' compensation coverage for the classification of work to be completed on the project;
- a sworn statement that coverage will remain in effect for the duration of the work;
- a completed work certificate that includes the number of employees anticipated to be employed by the contractor on the project;
- a copy of the contractor's compliance with a current written safety program, if applicable; and
- any other information that the state deems necessary.
Contractors who falsify information or fail to provide the required certifications will be subject to civil penalties of up to $2,500, and will be assessed a civil penalty of up to $100 per employee per day of noncompliance. In addition, any person with control or responsibility over the decision to disburse funds and salaries who knowingly falsifies information or fails to comply will be held personally liable for the payment of penalties and will not be allowed to bid or work on state projects for up to five years. The law also establishes a nonlapsing workers' compensation fraud fund in the office of the state treasurer. The penalties collected under the law will be used to establish the fund which will be used for investigations and compliance activities under the law.
Employee/independent contractors classification. S.B. 92 creates a uniform definition of employee throughout various statutes, including the workers' compensation law, and clarifies the criteria for exempting a worker from employee status. It is effective Jan. 1, 2008 . PIANH previously testified on the bill to offer suggestions to make the criteria for determining status more effective. The new law increases the current penalties for misrepresenting an employment relationship and parallels H.B. 471 in this regard. In addition to the current civil penalty of up to $2,500, an employer may also be assessed a civil penalty of $100 per employee for each day of non-compliance not to exceed one year. Also any person with control or responsibility over decisions to disburse funds and salaries and who knowingly misrepresents the work relationship will be held personally liable for the fines. All monetary penalties collected will be deposited into the nonlasping workers' compensation fraud fund.
Posting requiring. H.B. 336 requires information about classifying workers as employees or independent contractors be posted as part of the “Know Your Rights” notice in every place of employment. The law is effective Aug. 17, 2007. The poster is available from the New Hampshire Department of Labor and can be accessed via their Web site at http://www.labor.state.nh.us/
The current poster listing criteria to establish an independent contractor relationship will need to be updated Jan. 1, 2008 (the effective date of S.B. 92), when the criteria changes.
Workers' compensation penalties. H.B. 337 changes the penalty assessment period for employers who fail to comply with the workers' compensation law. It also increases the amount of the civil penalty assessed on an insurance carrier for failure to file notice of coverage, and like H.B. 471, establishes a special fund into which the civil penalties are to be deposited. The law is effective Aug. 12, 2007.
Workers' compensation employment disputes. On June 18, 2007, H.B. 426 was signed into law and was effective on that date. The new law gives the New Hampshire Labor Department statutory authority to conduct investigations and hold hearings to resolve premium disputes as they relate to the definition of employee versus independent contractor. PIANH recently met with the insurance department regarding this workers' compensation issue and plans to meet with the Department of Labor.
Medical benefits coverage. S.B. 189, which was effective July 13, 2007, amends the rules with respect to medical payments coverage under a motor vehicle liability policy. The law prohibits a health carrier from coordinating benefits against medical payments coverage and provides that medical payments coverage will not be assignable to any health care provider. The new law also gives the insured the exclusive right to submit a claim for medical expenses under either medical payments coverage or a health insurance policy or both, provided that the insured will not be entitled to duplicate payment from both medical payments coverage and a health insurance policy for the same medical expense.
Uninsured motorist coverage election. Current law provides that when an insured elects to buy liability insurance in an amount greater than the minimum coverage required by law, the uninsured motorist coverage must automatically be equal to the liability coverage elected. Umbrella or excess policies that provide excess limits must also provide uninsured motor coverage equal to the limits of liability purchased, unless the named insured rejects such coverage. S.B. 38 requires this rejection to be in writing. The new law also provides that rejection of such coverage by the named insured will constitute a rejection of coverage by all insureds, apply to all vehicles then or thereafter eligible to be covered and will remain effective upon policy amendment or renewal, unless the named insured requests the coverage in writing. The law takes effect Sept. 11, 2007.
Unfair claims practices. H.B. 169 makes it an unfair insurance trade practice for an insurer or adjuster to knowingly underestimate the value of an insurance claim. It is effective Jan. 1, 2008.
In addition to these new laws, Gov. Lynch vetoed the year's most anti-business piece of legislation in the beginning of July. H.B. 143, relative to the apportionment of damages and avidly supported by the New Hampshire trial bar, was opposed by PIANH and a broad coalition of business and community interest along with Attorney General, Kelly Ayotte. An effort will be put forth to overturn that veto when the legislature meets next. The bill would have unfairly put more responsibility for paying legal claims on parties that could most afford to pay the claim without regard to the party's degree of fault. 7/07
