Bill Summary – FastDemocracy

LEGISLATIVE GENERAL COUNSEL                                               H.B. 439
Approved for Filing: C.R. Gilbert 6
          6 01-31-24 8:26 AM 6
                        WORKERS' COMPENSATION REVISIONS
                                      2024 GENERAL SESSION
                                           STATE OF UTAH
                              Chief Sponsor: Anthony E. Loubet
                                Senate Sponsor: Todd D. Weiler
 6
 LONG TITLE
 General Description:
        This bill modifies provisions of the Workers' Compensation Act related to home and
 community based services.
 Highlighted Provisions:
        This bill:
        < clarifies the circumstances under which an individual with a disability is the
 employer of an individual providing home and community based services.
 Money Appropriated in this Bill:
        None
 Other Special Clauses:
        None
 Utah Code Sections Affected:
 AMENDS:
        34A-2-103, as last amended by Laws of Utah 2021, Chapter 286
22
 Be it enacted by the Legislature of the state of Utah:
        Section 1. Section 34A-2-103 is amended to read:
        34A-2-103. Employers enumerated and defined -- Regularly employed --
                                                                                                   H.B. 439
 Statutory employers -- Exceptions.
        (1) (a) The state, and each county, city, town, and school district in the state are
     *HB0439*
       H.B. 439                                                                    01-31-24 8:26 AM
 considered employers under this chapter and Chapter 3, Utah Occupational Disease Act.
          (b) For the purposes of the exclusive remedy in this chapter and Chapter 3, Utah
 Occupational Disease Act, prescribed in Sections 34A-2-105 and 34A-3-102, the state is
 considered to be a single employer and includes any office, department, agency, authority,
 commission, board, institution, hospital, college, university, or other instrumentality of the
 state.
          (2) (a) Subject to the other provisions of this section, each person, including each
 public utility and each independent contractor, who regularly employs one or more workers or
 operatives in the same business, or in or about the same establishment, under any contract of
 hire, express or implied, oral or written, is considered an employer under this chapter and
 Chapter 3, Utah Occupational Disease Act.
          (b) As used in this Subsection (2):
          (i) "Independent contractor" means any person engaged in the performance of any work
 for another who, while so engaged, is:
          (A) independent of the employer in all that pertains to the execution of the work;
          (B) not subject to the routine rule or control of the employer;
          (C) engaged only in the performance of a definite job or piece of work; and
          (D) subordinate to the employer only in effecting a result in accordance with the
 employer's design.
          (ii) "Regularly" includes all employments in the usual course of the trade, business,
 profession, or occupation of the employer, whether continuous throughout the year or for only a
 portion of the year.
          (3) (a) The client under a professional employer organization agreement regulated
 under Title 31A, Chapter 40, Professional Employer Organization Licensing Act:
          (i) is considered the employer of a covered employee; and
          (ii) subject to Section 31A-40-209, shall secure workers' compensation benefits for a
 covered employee by complying with Subsection 34A-2-201(1) and commission rules.
          (b) The division shall promptly inform the Insurance Department if the division has
 reason to believe that a professional employer organization is not in compliance with
 Subsection 34A-2-201(1) and commission rules.
          (4) A domestic employer who does not employ one employee or more than one
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       01-31-24 8:26 AM                                                                          H.B. 439
 employee at least 40 hours per week is not considered an employer under this chapter and
 Chapter 3, Utah Occupational Disease Act.
           (5) (a) As used in this Subsection (5):
           (i) (A) "Agricultural employer" means a person who employs agricultural labor as
 defined in Subsections 35A-4-206(1) and (2) and does not include employment as provided in
 Subsection 35A-4-206(3).
           (B) Notwithstanding Subsection (5)(a)(i)(A), only for purposes of determining who is a
 member of the employer's immediate family under Subsection (5)(a)(ii), if the agricultural
 employer is a corporation, partnership, or other business entity, "agricultural employer" means
 an officer, director, or partner of the business entity.
           (ii) "Employer's immediate family" means:
           (A) an agricultural employer's:
           (I) spouse;
           (II) grandparent;
           (III) parent;
           (IV) sibling;
           (V) child;
           (VI) grandchild;
           (VII) nephew; or
           (VIII) niece;
           (B) a spouse of any person provided in Subsections (5)(a)(ii)(A)(II) through (VIII); or
           (C) an individual who is similar to those listed in Subsection (5)(a)(ii)(A) or (B) as
 defined by rules of the commission.
           (iii) "Nonimmediate family" means a person who is not a member of the employer's
 immediate family.
           (b) For purposes of this chapter and Chapter 3, Utah Occupational Disease Act, an
 agricultural employer is not considered an employer of a member of the employer's immediate
 family.
           (c) For purposes of this chapter and Chapter 3, Utah Occupational Disease Act, an
 agricultural employer is not considered an employer of a nonimmediate family employee if:
           (i) for the previous calendar year the agricultural employer's total annual payroll for all
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        H.B. 439                                                                    01-31-24 8:26 AM
 nonimmediate family employees was less than $8,000; or
         (ii) (A) for the previous calendar year the agricultural employer's total annual payroll
 for all nonimmediate family employees was equal to or greater than $8,000 but less than
 $50,000; and
         (B) the agricultural employer maintains insurance that covers job-related injuries of the
 employer's nonimmediate family employees in at least the following amounts:
         (I) $300,000 liability insurance, as defined in Section 31A-1-301; and
         (II) $5,000 for health care benefits similar to benefits under health care insurance as
 defined in Section 31A-1-301.
         (d) For purposes of this chapter and Chapter 3, Utah Occupational Disease Act, an
 agricultural employer is considered an employer of a nonimmediate family employee if:
         (i) for the previous calendar year the agricultural employer's total annual payroll for all
 nonimmediate family employees is equal to or greater than $50,000; or
         (ii) (A) for the previous year the agricultural employer's total payroll for nonimmediate
 family employees was equal to or exceeds $8,000 but is less than $50,000; and
         (B) the agricultural employer fails to maintain the insurance required under Subsection
 (5)(c)(ii)(B).
         (6) An employer of agricultural laborers or domestic servants who is not considered an
 employer under this chapter and Chapter 3, Utah Occupational Disease Act, may come under
 this chapter and Chapter 3, Utah Occupational Disease Act, by complying with:
         (a) this chapter and Chapter 3, Utah Occupational Disease Act; and
         (b) the rules of the commission.
         (7) (a) (i) As used in this Subsection (7)(a), "employer" includes any of the following
 persons that procures work to be done by a contractor notwithstanding whether or not the
 person directly employs a person:
         (A) a sole proprietorship;
         (B) a corporation;
         (C) a partnership;
         (D) a limited liability company; or
         (E) a person similar to one described in Subsections (7)(a)(i)(A) through (D).
         (ii) If an employer procures any work to be done wholly or in part for the employer by
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        01-31-24 8:26 AM                                                                          H.B. 439
 a contractor over whose work the employer retains supervision or control, and this work is a
 part or process in the trade or business of the employer, the contractor, all persons employed by
 the contractor, all subcontractors under the contractor, and all persons employed by any of
 these subcontractors, are considered employees of the original employer for the purposes of
 this chapter and Chapter 3, Utah Occupational Disease Act.
           (b) Any person who is engaged in constructing, improving, repairing, or remodeling a
 residence that the person owns or is in the process of acquiring as the person's personal
 residence may not be considered an employee or employer solely by operation of Subsection
 (7)(a).
           (c) A partner in a partnership or an owner of a sole proprietorship is not considered an
 employee under Subsection (7)(a) if the employer who procures work to be done by the
 partnership or sole proprietorship obtains and relies on either:
           (i) a valid certification of the partnership's or sole proprietorship's compliance with
 Section 34A-2-201 indicating that the partnership or sole proprietorship secured the payment of
 workers' compensation benefits pursuant to Section 34A-2-201; or
           (ii) if a partnership or sole proprietorship with no employees other than a partner of the
 partnership or owner of the sole proprietorship, a workers' compensation coverage waiver
 issued pursuant to Part 10, Workers' Compensation Coverage Waivers Act, stating that:
           (A) the partnership or sole proprietorship is customarily engaged in an independently
 established trade, occupation, profession, or business; and
           (B) the partner or owner personally waives the partner's or owner's entitlement to the
 benefits of this chapter and Chapter 3, Utah Occupational Disease Act, in the operation of the
 partnership or sole proprietorship.
           (d) A director or officer of a corporation is not considered an employee under
 Subsection (7)(a) if the director or officer is excluded from coverage under Subsection
 34A-2-104(4).
           (e) A contractor or subcontractor is not an employee of the employer under Subsection
 (7)(a), if the employer who procures work to be done by the contractor or subcontractor obtains
 and relies on either:
           (i) a valid certification of the contractor's or subcontractor's compliance with Section
 34A-2-201; or
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        H.B. 439                                                                    01-31-24 8:26 AM
        (ii) if a partnership, corporation, or sole proprietorship with no employees other than a
 partner of the partnership, officer of the corporation, or owner of the sole proprietorship, a
 workers' compensation coverage waiver issued pursuant to Part 10, Workers' Compensation
 Coverage Waivers Act, stating that:
        (A) the partnership, corporation, or sole proprietorship is customarily engaged in an
 independently established trade, occupation, profession, or business; and
        (B) the partner, corporate officer, or owner personally waives the partner's, corporate
 officer's, or owner's entitlement to the benefits of this chapter and Chapter 3, Utah
 Occupational Disease Act, in the operation of the partnership's, corporation's, or sole
 proprietorship's enterprise under a contract of hire for services.
        (f) (i) For purposes of this Subsection (7)(f), "eligible employer" means a person who:
        (A) is an employer; and
        (B) procures work to be done wholly or in part for the employer by a contractor,
 including:
        (I) all persons employed by the contractor;
        (II) all subcontractors under the contractor; and
        (III) all persons employed by any of these subcontractors.
        (ii) Notwithstanding the other provisions in this Subsection (7), if the conditions of
 Subsection (7)(f)(iii) are met, an eligible employer is considered an employer for purposes of
 Section 34A-2-105 of the contractor, subcontractor, and all persons employed by the contractor
 or subcontractor described in Subsection (7)(f)(i)(B).
        (iii) Subsection (7)(f)(ii) applies if the eligible employer:
        (A) under Subsection (7)(a) is liable for and pays workers' compensation benefits as an
 original employer under Subsection (7)(a) because the contractor or subcontractor fails to
 comply with Section 34A-2-201;
        (B) (I) secures, in accordance with Section 34A-2-201, the payment of workers'
 compensation coverage for the contractor or subcontractor;
        (II) procures work to be done that is part or process of the trade or business of the
 eligible employer; and
        (III) does the following with regard to a written workplace accident and injury
 reduction program that meets the requirements of Subsection 34A-2-111(3)(d):
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        01-31-24 8:26 AM                                                                        H.B. 439
         (Aa) adopts the workplace accident and injury reduction program;
         (Bb) posts the workplace accident and injury reduction program at the work site at
 which the eligible employer procures work; and
         (Cc) enforces the workplace accident and injury reduction program according to the
 terms of the workplace accident and injury reduction program; or
         (C) (I) obtains and relies on:
         (Aa) a valid certification described in Subsection (7)(c)(i) or (7)(e)(i);
         (Bb) a workers' compensation coverage waiver described in Subsection (7)(c)(ii) or
 (7)(e)(ii); or
         (Cc) proof that a director or officer is excluded from coverage under Subsection
 34A-2-104(4);
         (II) is liable under Subsection (7)(a) for the payment of workers' compensation benefits
 if the contractor or subcontractor fails to comply with Section 34A-2-201;
         (III) procures work to be done that is part or process in the trade or business of the
 eligible employer; and
         (IV) does the following with regard to a written workplace accident and injury
 reduction program that meets the requirements of Subsection 34A-2-111(3)(d):
         (Aa) adopts the workplace accident and injury reduction program;
         (Bb) posts the workplace accident and injury reduction program at the work site at
 which the eligible employer procures work; and
         (Cc) enforces the workplace accident and injury reduction program according to the
 terms of the workplace accident and injury reduction program.
         (8) (a) For purposes of this Subsection (8), "unincorporated entity" means an entity
 organized or doing business in the state that is not:
         (i) an individual;
         (ii) a corporation; or
         (iii) publicly traded.
         (b) For purposes of this chapter and Chapter 3, Utah Occupational Disease Act, an
 unincorporated entity that is required to be licensed under Title 58, Chapter 55, Utah
 Construction Trades Licensing Act, is presumed to be the employer of each individual who
 holds, directly or indirectly, an ownership interest in the unincorporated entity.
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        H.B. 439                                                                    01-31-24 8:26 AM
 Notwithstanding Subsection (7)(c) and Subsection 34A-2-104(3), the unincorporated entity
 shall provide the individual who holds the ownership interest workers' compensation coverage
 under this chapter and Chapter 3, Utah Occupational Disease Act, unless the presumption is
 rebutted under Subsection (8)(c).
         (c) Pursuant to rules made by the commission in accordance with Title 63G, Chapter 3,
 Utah Administrative Rulemaking Act, an unincorporated entity may rebut the presumption
 under Subsection (8)(b) for an individual by establishing by clear and convincing evidence that
 the individual:
         (i) is an active manager of the unincorporated entity;
         (ii) directly or indirectly holds at least an 8% ownership interest in the unincorporated
 entity; or
         (iii) is not subject to supervision or control in the performance of work by:
         (A) the unincorporated entity; or
         (B) a person with whom the unincorporated entity contracts.
         (d) As part of the rules made under Subsection (8)(c), the commission may define:
         (i) "active manager";
         (ii) "directly or indirectly holds at least an 8% ownership interest"; and
         (iii) "subject to supervision or control in the performance of work."
         (9) (a) As used in this Subsection (9), "home and community based services" means
 one or more of the following in-home services provided to an individual with a disability or to
 the individual's family that helps prevent the individual with a disability from being placed in a
 mor