House Study Bill 54 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON JUDICIARY BILL BY CHAIRPERSON BALTIMORE) A BILL FOR An Act relating to certain persons who are excluded from 1 coverage under the workers’ compensation law of this state. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 1682YC (3) 86 av/rj

H.F. _____ Section 1. Section 87.22, Code 2015, is amended to read as 1 follows: 2 87.22 Corporate officer exclusion Exclusion from workers’ 3 compensation or employers’ liability coverage —— corporate 4 officers, proprietors, limited liability company members, limited 5 liability partners, and partners . 6 1. The president, vice president, secretary, and treasurer 7 of a corporation other than a family farm corporation, but 8 not to exceed four officers per corporation, may exclude 9 themselves from workers’ compensation coverage under chapters 10 85 , 85A , and 85B by knowingly and voluntarily rejecting 11 workers’ compensation coverage by signing, and attaching to the 12 workers’ compensation or employers’ liability policy a written 13 rejection, or if such a policy is not issued, by signing a 14 written rejection which is witnessed by two disinterested 15 individuals who are not, formally or informally, affiliated 16 with the corporation and which is filed by the corporation 17 with the workers’ compensation commissioner. The workers’ 18 compensation commissioner shall maintain a list of those 19 corporations that have filed a written rejection pursuant to 20 this subsection or a written termination of that rejection 21 pursuant to subsection 5, paragraph “a” , and that list shall be 22 a public record open to public inspection. 23 2. A proprietor, limited liability company member, limited 24 liability partner, or partner who does not elect to be covered 25 by the workers’ compensation law of this state pursuant 26 to section 85.1A by purchasing valid workers’ compensation 27 insurance specifically including that person, shall file a 28 nonelection of workers’ compensation coverage by signing, and 29 attaching to the workers’ compensation or employers’ liability 30 policy a written nonelection, or if such a policy is not 31 issued, by signing a written nonelection which is witnessed 32 by two disinterested individuals who are not, formally or 33 informally, affiliated with the employer and which is filed by 34 the employer with the workers’ compensation commissioner. The 35 -1- LSB 1682YC (3) 86 av/rj 1/ 6

H.F. _____ workers’ compensation commissioner shall maintain a list of 1 those employers that have filed a written nonelection pursuant 2 to this subsection or a written termination of that nonelection 3 pursuant to subsection 5, paragraph “b” , and that list shall be 4 a public record open to public inspection. 5 2. 3. a. The written rejection made pursuant to subsection 6 1, shall be in substantially the following form: 7 REJECTION OF WORKERS’ 8 COMPENSATION OR EMPLOYERS’ 9 LIABILITY COVERAGE 10 I understand that by signing this statement I reject the 11 coverage of chapters 85 , 85A , and 85B of the Code of Iowa 12 relating to workers’ compensation. 13 I understand that my rejection of the coverage of chapters 14 85 , 85A , and 85B is not a waiver of any rights or remedies 15 available to me or to others on my behalf in a civil action 16 related to personal injuries sustained by me arising out of and 17 in the course of my employment with the corporation. 18 I also understand that by signing this statement and checking 19 alternative (1) below I reject employers’ liability coverage 20 for bodily injuries or death sustained by me arising out of and 21 in the course of my employment with the corporation. [Check 22 either alternative (1) or (2):] 23 (1) I reject the employers’ liability coverage. 24 (2) I decline to reject the employers’ liability coverage. 25 Signed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Corporate Office . . . . . . . . . . . . . . . . . . . . . 27 Date . . . . . . . . . . . . . . . . . . . . . . . . 28 City, County, State of Residence . . . . . . . . . . . . . . . . . . . . . . . . . 29 Witness .................... 30 Witness .................... 31 I also understand that the signing of this statement and 32 checking of alternative (1) below by an authorized agent of the 33 corporation rejects for the corporation employers’ liability 34 coverage for bodily injuries or death sustained by me arising 35 -2- LSB 1682YC (3) 86 av/rj 2/ 6

H.F. _____ out of and in the course of my employment with the corporation. 1 [Check either alternative (1) or (2):] 2 (1) The corporation rejects the employers’ liability 3 coverage. 4 (2) The corporation declines to reject the employers’ 5 liability coverage. 6 Signed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Relationship to Corporation . . . . . . . . . . . . . . . . . . . . . . . . 8 Date . . . . . . . . . . . . . . . . . . . . . . . . 9 City, County, State of Residence . . . . . . . . . . . . . . . . . . . . . . . . . 10 Witness .................... 11 Witness .................... 12 b. The written nonelection of coverage made pursuant to 13 subsection 2, shall be in substantially the following form: 14 NONELECTION OF WORKERS’ 15 COMPENSATION OR EMPLOYERS’ 16 LIABILITY COVERAGE 17 I acknowledge that I am a proprietor, limited liability 18 company member, limited liability partner, or partner and that 19 I am not required to be covered by the worker’s compensation 20 law of this state pursuant to section 85.1A. I understand 21 that by signing this statement I am not electing the coverage 22 of chapters 85, 85A, and 85B of the Code of Iowa relating to 23 workers’ compensation. 24 I understand that my nonelection of the coverage of chapters 25 85, 85A, and 85B is not a waiver of any rights or remedies 26 available to me or to others on my behalf in a civil action 27 related to personal injuries sustained by me arising out of and 28 in the course of my employment with the employer. 29 I also understand that by signing this statement and checking 30 alternative (1) below I am not electing employers’ liability 31 coverage for bodily injuries or death sustained by me arising 32 out of and in the course of my employment with the employer. 33 [Check either alternative (1) or (2):] 34 (1) I am not electing the employer’s liability coverage. 35 -3- LSB 1682YC (3) 86 av/rj 3/ 6

H.F. _____ (2) I am electing the employer’s liability coverage by 1 purchasing valid workers’ compensation insurance specifically 2 including me. 3 Signed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Employer’s Office . . . . . . . . . . . . . . . . . . . . 5 Date . . . . . . . . . . . . . . . . . . . . . . . . 6 City, County, State of Residence . . . . . . . . . . . . . . . . . . . . . . . . . 7 Witness .................... 8 Witness .................... 9 I also understand that the signing of this statement and 10 checking of alternative (1) below by an authorized agent of the 11 employer is a nonelection for the employer of the employers’ 12 liability coverage for bodily injuries or death sustained by 13 me arising out of and in the course of my employment with the 14 employer. [Check either alternative (1) or (2):] 15 (1) The employer does not elect the employer’s liability 16 coverage. 17 (2) The employer elects the employer’s liability coverage by 18 purchasing valid workers’ compensation insurance specifically 19 including me. 20 Signed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Relationship to Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Date . . . . . . . . . . . . . . . . . . . . . . . . 23 City, County, State of Residence . . . . . . . . . . . . . . . . . . . . . . . . . 24 Witness .................... 25 Witness .................... 26 3. 4. The rejection or nonelection of workers’ compensation 27 coverage is not enforceable if it is required as a condition 28 of employment. 29 4. 5. a. A corporate officer who signs a written rejection 30 filed with the workers’ compensation commissioner pursuant to 31 subsection 1 may terminate the rejection by signing a written 32 notice of termination which is witnessed by two disinterested 33 individuals, who are not, formally or informally, affiliated 34 with the corporation and which is filed by the corporation with 35 -4- LSB 1682YC (3) 86 av/rj 4/ 6

H.F. _____ the workers’ compensation commissioner. Following the filing 1 of a notice of termination pursuant to this paragraph, the 2 status of the person signing the notice of termination shall 3 be the same as if the rejection of coverage had not been made, 4 except that the notice of termination shall not be effective as 5 to any injury sustained or disease incurred less than one week 6 after the notice is filed. 7 b. A proprietor, limited liability company member, limited 8 liability partner, or partner who signs a written nonelection 9 with the workers’ compensation commissioner pursuant to 10 subsection 2 may terminate the nonelection by signing a written 11 notice of termination which is witnessed by two disinterested 12 individuals, who are not, formally or informally, affiliated 13 with the employer and which is filed by the employer with the 14 workers’ compensation commissioner. Following the filing of a 15 notice of termination pursuant to this paragraph, the status 16 of the person signing the notice of termination shall be the 17 same as if the nonelection of coverage had not been made and 18 the person may elect to be covered by the workers’ compensation 19 law of this state by purchasing valid workers’ compensation 20 insurance specifically including that person as provided in 21 section 85.1A, except that the election of coverage shall not 22 be effective as to any injury sustained or disease incurred 23 less than one week after the notice is filed. 24 EXPLANATION 25 The inclusion of this explanation does not constitute agreement with 26 the explanation’s substance by the members of the general assembly. 27 This bill relates to certain persons who are excluded from 28 workers’ compensation coverage requirements. 29 The bill provides that the workers’ compensation 30 commissioner shall maintain a list of corporate officers that 31 reject workers’ compensation coverage or that terminate their 32 rejection of the coverage. The list shall be a public record 33 that is open to public inspection. 34 The bill also requires a proprietor, limited liability 35 -5- LSB 1682YC (3) 86 av/rj 5/ 6

H.F. _____ company member or partner, or a partner, who does not elect 1 workers’ compensation coverage by purchasing valid coverage 2 that specifically includes that person, to sign a nonelection 3 of that coverage which must be attached to the workers’ 4 compensation or employer’s liability policy or filed with the 5 workers’ compensation commissioner. The workers’ compensation 6 commissioner is required to maintain a list of persons who do 7 not elect such coverage or that terminate that nonelection of 8 coverage. The list shall be a public record that is open to 9 public inspection. The bill also provides a form for such a 10 person to indicate that the person is not electing workers’ 11 compensation coverage. 12 The bill provides that when a corporate officer terminates a 13 rejection of workers’ compensation coverage by filing a notice 14 of termination with the workers’ compensation commissioner, the 15 notice of termination restores the officer to the same status 16 as if the rejection of coverage had not occurred although the 17 termination of rejection is not effective as to any injury 18 sustained or disease incurred less than one week after the 19 notice is filed. 20 The bill provides also that a proprietor, limited liability 21 company member or partner, or partner, may terminate a 22 nonelection of workers’ compensation coverage by filing 23 a notice of termination with the workers’ compensation 24 commissioner. The notice of termination restores that person 25 to the same status as if the nonelection of coverage had not 26 occurred and the person may elect to be covered by the workers’ 27 compensation law of this state by purchasing valid workers’ 28 compensation insurance specifically including that person, 29 as provided in Code section 85.1A. However, the election of 30 coverage shall not be effective as to any injury sustained or 31 disease incurred less than one week after the notice is filed. 32 -6- LSB 1682YC (3) 86 av/rj 6/ 6