California: New Workers’ Comp Law Expands Coverage Requirements

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All Employers with California Employees

EFFECTIVE

January 1, 2017

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AB 2883 revises the definition of “employee” in workers’ compensation insurance policies, adding officers, directors, and working members of partnerships and limited liability companies.  Currently, such individuals are generally not required to be covered under a business’s workers’ compensation policy.   Under AB 2883, such workers will be generally required to be covered; a narrow exclusion permits certain individuals to opt out by signing and filing a waiver with the insurance carrier.

Workers’ compensation insurers must provide notice to employers who have employees that were previously excluded from coverage.  This change will apply to currently in-force policies as of January 1, 2017.  After the effective date, any individual who has been exempted from workers’ compensation coverage must be added to coverage until a signed waiver is received and accepted by the insurer.

Action Items

  1. Consult with your workers’ compensation carrier to determine how you may be affected by this change.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2016 ManagEase, Incorporated.

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