00 HOUSE BILL NO. 237 01 "An Act relating to workers' compensation insurance rate filings; to second 02 independent medical evaluations for workers' compensation claims; to immunity for 03 third-party design professionals from civil actions by recipients of workers' 04 compensation benefits; to workers' compensation death benefits; to computation of 05 workers' compensation benefits; to penalties for fraudulent acts related to workers' 06 compensation; to immunity for employer workplace safety inspections related to 07 workers' compensation insurance; and providing for an effective date." 08 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 09 * Section 1. FINDINGS AND PURPOSE AS TO SECTION 7. (a) The 10 legislature finds that 11 (1) efficiency in calculating workers' compensation benefits does not 12 require unfairness; 13 (2) a quick, efficient, and predictable scheme for determining a worker's 14 gross weekly earnings can be formulated without denying employees their workers' 01 compensation benefits commensurate with their actual losses; 02 (3) many workers in the state are only seasonally employed in the 03 construction, tourism, fishing, and education industries; 04 (4) many workers in the state choose a subsistence lifestyle and are 05 only occasionally, sporadically, or on a part-time basis members of the labor force; 06 (5) many other states avoid the need for an alternative open-ended 07 determination of an employee's future earning capacity by focusing on the employee's 08 wages at the time of injury and converting, by formula, the employee's rate of pay 09 into a weekly wage; 10 (6) benefits for permanent total disability can last for a substantial 11 period into the future and serve a different purpose than benefits for temporary partial 12 or temporary total disability. 13 (b) It is the purpose of sec. 7 of this Act to 14 (1) redefine the calculation of an employee's spendable weekly wage 15 used to determine workers' compensation benefits in a manner that complies with the 16 decision of the Alaska Supreme Court in Gilmore v. Alaska Workers' Compensation 17 Board, 882 P.2d 922 (Alaska 1994); 18 (2) fix a fair approximation of an employee's probable future earning 19 capacity during the period of temporary partial or temporary total disability without 20 resorting to an open-ended determination of actual future earning capacity; 21 (3) avoid uncertainty and litigation for injured workers and their 22 employers; 23 (4) allow an alternative open-ended determination of actual future 24 earnings for those employees who suffer a permanent total disability and whose wages 25 cannot otherwise be fairly calculated. 26 * Sec. 2. AS 21.39 is amended by adding a new section to read: 27 Sec. 21.39.045. WORKERS' COMPENSATION RATE FILINGS. (a) 28 Notwithstanding any other provision of this chapter, a rate filing for workers' 29 compensation insurance that classifies a risk in the construction industry may 30 not contain or impose a higher premium rate if the risk upon which the higher 31 rate filing is based consists only of a higher wage rate paid by the employer. 01 (b) The director shall accept a rate filing for workers' compensation 02 insurance if the filing includes a reasonable method of recognizing differences 03 in rates of pay and the method uses a credit scale that begins at an amount 04 equal to the average weekly wage in this state as determined by the 05 Department of Labor. 06 * Sec. 3. AS 23.30 is amended by adding a new section to read: 07 Sec. 23.30.017. IMMUNITY FOR THIRD-PARTY DESIGN 08 PROFESSIONAL. (a) A person entitled to compensation under this chapter 09 as a result of injury occurring at the job site of a construction project may 10 not bring a civil action to recover damages for that injury against a design 11 professional or an employee of a design professional who provides professional 12 services for the construction project. 13 (b) This section does not apply to a person receiving compensation 14 under this chapter who is injured at a job site at which the design professional 15 or employee of the design professional 16 (1) specifically assumed responsibility for job site safety practices 17 under a contract; 18 (2) actually exercises control over the premises where the injury 19 occurred; 20 (3) prepared design plans or specifications, the plans or 21 specifications contributed to the injury, and the plans or specifications were 22 prepared negligently, recklessly, or with intentional misconduct. 23 (c) In this section, 24 (1) "design professional" means a person licensed under 25 AS 08.48 as an architect, engineer, or land surveyor; 26 (2) "professional services" means services provided by a design 27 professional that are within the scope of services for which the design 28 professional is licensed. 29 * Sec. 4. AS 23.30.095(k) is amended to read: 30 (k) In the event of a medical dispute regarding determinations of 31 causation, medical stability, ability to enter a reemployment plan, degree of 01 impairment, functional capacity, the amount and efficacy of the continuance of 02 or necessity of treatment, or compensability between the employee's attending 03 physician and the employer's independent medical evaluation, the board may 04 require that a second independent medical evaluation [SHALL] be conducted 05 by a physician or physicians selected by the board from a list established and 06 maintained by the board. The cost of an [THE] examination and medical 07 report shall be paid by the employer. The report of an [THE] independent 08 medical examiner shall be furnished to the board and to the parties within 14 09 days after the examination is concluded. A person may not seek damages 10 from an independent medical examiner caused by the rendering of an opinion 11 or providing testimony under this subsection, except in the event of fraud or 12 gross incompetence. 13 * Sec. 5. AS 23.30.175(b) is amended to read: 14 (b) The following rules apply to benefits payable to recipients not 15 residing in the state at the time compensation benefits are payable: 16 (1) the weekly rate of compensation shall be calculated by 17 multiplying the recipient's weekly compensation rate calculated under 18 AS 23.30.180, 23.30.185, 23.30.190, 23.30.200, or 23.30.215, by the ratio of 19 the cost of living of the area in which the recipient resides to the cost of 20 living in this state; 21 (2) the calculation required by (1) of this subsection does not 22 apply if the recipient is absent from the state for medical or rehabilitation 23 services not reasonably available in the state; 24 (3) if the gross weekly earnings of the recipient and the 25 resulting compensation rate are determined under AS 23.30.220(a)(6), (7), or 26 (10) [AS 23.30.220(a)(2)], the calculation required by this subsection applies 27 only to the portion of the recipient's weekly compensation rate attributable to 28 wages earned in the state; 29 (4) application of this subsection may not reduce the weekly 30 compensation rate to less than $154 a week, except as provided in (a) of this 31 section. 01 * Sec. 6. AS 23.30.215(f) is amended to read: 02 (f) Except as provided in (g) of this section, the death benefit payable 03 to a widow or widower shall 04 [(1) FIVE YEARS FOLLOWING DATE OF DEATH OF THE 05 DECEASED EMPLOYEE BE REDUCED TO 66 2/3 PERCENT OF THE 06 BENEFIT BEING THEN PAID; 07 (2) EIGHT YEARS FOLLOWING DATE OF DEATH OF THE 08 DECEASED EMPLOYEE BE REDUCED TO 50 PERCENT OF THE BENEFIT 09 BEING THEN PAID; 10 (3)] terminate 10 years following death of the deceased 11 employee. 12 * Sec. 7. AS 23.30.220(a) is repealed and reenacted to read: 13 (a) Computation of compensation under this chapter shall be on the 14 basis of an employee's spendable weekly wage at the time of injury. An 15 employee's spendable weekly wage is the employee's gross weekly earnings 16 minus payroll tax deductions. An employee's gross weekly earnings shall be 17 calculated as follows: 18 (1) if at the time of injury the employee's earnings are 19 calculated by the week, the weekly amount is the employee's gross weekly 20 earnings; 21 (2) if at the time of injury the employee's earnings are 22 calculated by the month, the employee's gross weekly earnings are the monthly 23 earnings multiplied by 12 and divided by 52; 24 (3) if at the time of injury the employee's earnings are 25 calculated by the year, the employee's gross weekly earnings are the yearly 26 earnings divided by 52; 27 (4) if at the time of injury the 28 (A) employee's earnings are calculated by the day, hour, 29 or by the output of the employee, the employee's gross weekly earnings 30 are the employee's earnings most favorable to the employee computed 31 by dividing by 13 the employee's earnings, not including overtime or 01 premium pay, earned during any period of 13 consecutive calendar weeks 02 within the 52 weeks immediately preceding the injury; 03 (B) employee has been employed for less than 13 04 calendar weeks immediately preceding the injury, then, notwithstanding 05 (1) - (3) of this subsection and (A) of this paragraph, the employee's 06 gross weekly earnings are computed by determining the amount that the 07 employee would have earned, not including overtime or premium pay, 08 had the employee been employed by the employer for 13 calendar weeks 09 immediately preceding the injury and dividing this sum by 13; 10 (5) if at the time of injury the employee's earnings have not 11 been fixed or cannot be ascertained, the employee's earnings for the purpose 12 of calculating compensation are the usual wage for similar services when the 13 services are rendered by paid employees; 14 (6) if at the time of injury the employment is exclusively 15 seasonal or temporary, then, notwithstanding (1) - (5) of this subsection, the 16 gross weekly earnings are 1/50th of the total wages that the employee has 17 earned from all occupations during the calendar year immediately preceding the 18 injury; 19 (7) when the employee is working under concurrent contracts 20 with two or more employers and the employer liable for compensation has 21 knowledge of the dual employment before the injury, the employee's earnings 22 from all employers is considered as if earned from the employer liable for 23 compensation; 24 (8) if an employee when injured is a minor, an apprentice, or 25 a trainee in a formal training program, as determined by the board, whose 26 wages under normal conditions would increase during the period of disability, 27 the projected increase may be considered by the board in computing the gross 28 weekly earnings of the employee; 29 (9) if the employee is injured while performing duties as a 30 volunteer ambulance attendant, volunteer police officer, or volunteer fire fighter, 31 then, notwithstanding (1) - (6) of this subsection, the gross weekly earnings for 01 calculating compensation shall be the minimum gross weekly earnings paid a 02 full-time ambulance attendant, police officer, or fire fighter employed in the 03 political subdivision where the injury occurred, or, if the political subdivision 04 has no full-time ambulance attendants, police officers, or fire fighters, at a 05 reasonable figure previously set by the political subdivision to make this 06 determination, but in no case may the gross weekly earnings for calculating 07 compensation be less than the minimum wage computed on the basis of 40 08 hours work per week; 09 (10) if an employee is entitled to compensation under 10 AS 23.30.180 and the board determines that calculation of the employee's gross 11 weekly earnings under (1) - (7) of this subsection does not fairly reflect the 12 employee's earnings during the period of disability, the board shall determine 13 gross weekly earnings by considering the nature of the employee's work, work 14 history, and resulting disability, but compensation calculated under this paragraph 15 may not exceed the employee's gross weekly earnings at the time of injury. 16 * Sec. 8. AS 23.30.250 is repealed and reenacted to read: 17 Sec. 23.30.250. PENALTIES FOR FRAUDULENT OR MISLEADING 18 ACTS. (a) A person who (1) knowingly makes a false or misleading 19 statement, representation, or submission related to a benefit under this chapter; 20 (2) knowingly assists, abets, solicits, or conspires in making a false or 21 misleading submission affecting the payment, coverage, or other benefit under 22 this chapter; (3) knowingly misclassifies employees or engages in deceptive 23 leasing practices for the purpose of evading full payment of workers' 24 compensation insurance premiums; or (4) employs or contracts with a person 25 or firm to coerce or encourage an individual to file a fraudulent compensation 26 claim is civilly liable to a person adversely affected by the conduct, is guilty 27 of theft by deception as defined in AS 11.46.180, and may be punished as 28 provided by AS 11.46.120 - 11.46.150. 29 (b) If the board, after a hearing, finds that a person has obtained 30 compensation, medical treatment, or another benefit provided under this chapter 31 by knowingly making a false or misleading statement or representation for the 01 purpose of obtaining that benefit, the board shall order that person to make full 02 reimbursement of the cost of all benefits obtained. Upon entry of an order 03 authorized under this subsection, the board shall also order that person to pay 04 all reasonable costs and attorney fees incurred by the employer and the 05 employer's carrier in obtaining an order under this section and in defending any 06 claim made for benefits under this chapter. If a person fails to comply with 07 an order of the board requiring reimbursement of compensation and payment 08 of costs and attorney fees, the employer may declare the person in default and 09 proceed to collect any sum due as provided under AS 23.30.170(b) and (c). 10 * Sec. 9. AS 23.30 is amended by adding a new section to read: 11 Sec. 23.30.263. IMMUNITY FROM CIVIL LIABILITY FOR 12 WORKPLACE SAFETY INSPECTIONS. An employer's safety inspector is not 13 liable for civil damages for an injury to an employee of that employer 14 resulting from an act or omission in performing or failing to perform a loss 15 control service, a workplace safety inspection, or a safety advisory service 16 provided in connection with an employer's workers' compensation insurance 17 coverage, unless the act or failure to act constitutes intentional misconduct. In 18 this section, "safety inspector" means 19 (1) a carrier and an employee or agent of the carrier; 20 (2) a trade association of which the employer is a member; or 21 (3) a person providing adjusting or inspection services to an 22 employer who is a member of an association established under AS 21.76.010 23 or to an employer who is self-insured under AS 23.30.090. 24 * Sec. 10. AS 23.30.265 is amended by adding new paragraphs to read: 25 (35) "seasonal work" means employment that does not continue 26 through an entire calendar year; 27 (36) "temporary work" means employment that is not permanent, 28 ends upon completion of the task, job, or contract, and ends within six months 29 from the date of injury. 30 * Sec. 11. TRANSITION. By January 1, 1996, a rating organization that files 31 a rate for workers' compensation insurance shall file a rating that contains a method 01 of computing workers' compensation insurance rates that is in compliance with 02 AS 21.39.045, added by sec. 2 of this Act. 03 * Sec. 12. Section 2 of this Act applies to a policy of workers' compensation 04 insurance that is entered into or renewed on or after the effective date of this Act. 05 * Sec. 13. This Act takes effect July 1, 1995.