BP BHEAD INT S

AN ACT Relating to workers' compensation insurance for small businesses; and amending RCW 51.16.035 and 51.16.060.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. RCW 51.16.035 and 1989 c 49 s 1 are each amended to read as follows:

(1) Except as otherwise provided for in subsection (2) of this section, the department shall classify all occupations or industries in accordance with their degree of hazard and fix therefor basic rates of premium which shall be the lowest necessary to maintain actuarial solvency of the accident and medical aid funds in accordance with recognized insurance principles. The department shall formulate and adopt rules and regulations governing the method of premium calculation and collection and providing for a rating system consistent with recognized principles of workers' compensation insurance which shall be designed to stimulate and encourage accident prevention and to facilitate collection. The department may annually, or at such other times as it deems necessary to maintain solvency of the funds, readjust rates in accordance with the rating system to become effective on such dates as the department may designate.

(2) For small businesses with three or fewer employees and a payroll of less than five thousand dollars per year the department shall set the premium at forty dollars per year.

(3) The department may insure the workers' compensation obligations of employers as a group if the following conditions are met:

((~~(1)~~)) (a) All the employers in the group are members of an organization that has been in existence for at least two years;

((~~(2)~~)) (b) The organization was formed for a purpose other than that of obtaining workers' compensation coverage;

((~~(3)~~)) (c) The occupations or industries of the employers in the organization are substantially similar, taking into consideration the nature of the services being performed by workers of such employers; and

((~~(4)~~)) (d) The formation and operation of the group program in the organization will substantially improve accident prevention and claim management for the employers in the group.

In providing an employer group plan under this section, the department may consider an employer group as a single employing entity for purposes of dividends or premium discounts.

Sec. 2. RCW 51.16.060 and 1985 c 315 s 1 are each amended to read as follows:

(1) Except as otherwise provided for in subsection (2) of this section, every employer not qualifying as a self-insurer((,)) shall insure with the state and shall, on or before the last day of January, April, July and October of each year thereafter, furnish the department with a true and accurate payroll for the period in which workers were employed by it during the preceding calendar quarter, the total amount paid to such workers during such preceding calendar quarter, and a segregation of employment in the different classes established pursuant to this title, and shall pay its premium thereon to the appropriate fund. Premiums for a calendar quarter, whether reported or not, shall become due and delinquent on the day immediately following the last day of the month following the calendar quarter. The sufficiency of such statement shall be subject to the approval of the director: PROVIDED, That the director may in his or her discretion and for the effective administration of this title require an employer in individual instances to furnish a supplementary report containing the name of each individual worker, his or her hours worked, his or her rate of pay and the class or classes in which such work was performed: PROVIDED FURTHER, That in the event an employer shall furnish the department with four consecutive quarterly reports wherein each such quarterly report indicates that no premium is due the department may close the account: PROVIDED FURTHER, That the department may ((~~promulgate~~)) adopt rules and regulations in accordance with chapter 34.05 RCW to establish other reporting periods and payment due dates in lieu of reports and payments following each calendar quarter, and may also establish terms and conditions for payment of premiums and assessments based on estimated payrolls, with such payments being subject to approval as to sufficiency of the estimated payroll by the department, and also subject to appropriate periodic adjustments made by the department based on actual payroll((~~: AND PROVIDED FURTHER, That~~)).

(2) Every employer with three or fewer employees and a payroll of less than five thousand dollars not qualifying as a self-insurer shall insure with the state and shall, on or before the last day of January of each year thereafter, furnish the department with a true and accurate payroll for the period in which workers were employed by it during the preceding calendar year, the total amount paid to such workers during such preceding calendar year, and a segregation of employment in the different classes established pursuant to this title, and shall pay its premium thereon to the appropriate fund. Premiums for a calendar year, whether reported or not, shall become due and delinquent on the day immediately following the last day of January following the calendar year. The sufficiency of such statement shall be subject to the approval of the director: PROVIDED, That the director may in his or her discretion and for the effective administration of this title require an employer in individual instances to furnish a supplementary report containing the name of each individual worker, his or her hours worked, his or her rate of pay and the class or classes in which such work was performed: PROVIDED FURTHER, That in the event an employer shall furnish the department with a yearly report indicating that no premium is due the department may close the account: PROVIDED FURTHER, That the department may establish terms and conditions for payment of premiums and assessments based on estimated payrolls, with such payments being subject to approval as to sufficiency of the estimated payroll by the department, and also subject to appropriate periodic adjustments made by the department based on actual payroll.

(3) A temporary help company which provides workers on a temporary basis to its customers shall be considered the employer for purposes of reporting and paying premiums and assessments under this title according to the appropriate rate classifications as determined by the department: PROVIDED, That the employer shall be liable for paying premiums and assessments, should the temporary help company fail to pay the premiums and assessments under this title.