The department of Insurance has issued a notice to all California businesses regarding Workers Compensation Insurance. Here is a summary...
Effective January 1, 2017, AB 2883 (Assembly Insurance Committee) makes certain changes to the definition of employee and exclusions to the definition of employee set forth in sections 3351 and 3352 of the Labor Code. Specifically, officers and members of boards of directors while rendering actual service for the corporation for pay will be covered employees unless the officer or member of the board of directors owns at least 15 percent of the issued and outstanding stock of corporation and executes a written waiver of his or her rights under the Labor Code stating under penalty of perjury that the person is a qualifying officer or director. Similarly, working members of a partnership or limited liability company receiving wages irrespective of profits from the partnership or limited liability company will be covered employees unless the individual is a general partner of a partnership or a managing member of a limited liability company and executes a written waiver of his or her rights under the Labor Code stating under penalty of perjury that the person is a qualifying general partner or managing member. AB 2883 also amends Labor Code Section 3352 to provide that if a waiver is executed, the waiver “shall be effective upon the date of receipt and acceptance by the … insurance carrier ….”
What to do:
1. Any contributing owner, partner or shareholder that has less than 15% share of ownership must be covered by workers comp.
2. Those with over 15% must sign a waiver of coverage.
3. Return the Waiver to your workers comp insurance carrier.
Attached is a copy of the notice, and also a sample waiver form for owners, shareholders and partners to sign.
If you have any questions, please contact me at 800-846-5902.