04/29/2004 08:08 AM Senate JUD

         SB 369-UNIV. STUDENT PRACTICUM LIABILITY/WAGES                                                                     
                                                                                                                                
SENATOR PETE  KELLY, representing the University  of Alaska (UA),                                                               
told  members  that  SB  369  addresses a  problem  that  UA  has                                                               
encountered. About  five years  ago, UA was  given money  for the                                                               
first time over and above  the amount needed for operating costs.                                                               
With  that, the  Board  of Regents  and  President established  a                                                               
number of new  degree programs that are more "hands  on," most of                                                               
which  deal   with  medical  professions  and   the  construction                                                               
industry. A number of these  programs require a certain number of                                                               
hours  of practicum  work.  As UA  has  approached providers  for                                                               
practicum  purposes, it  has learned  that  liability has  become                                                               
more  of  a problem  that  is  discouraging some  employers  from                                                               
participating in the  programs. Many of the  programs are growing                                                               
and UA anticipates  continued growth. This year  in Fairbanks, UA                                                               
was able  to only arrange  the bare minimum requirements  for its                                                               
dental  program. That  situation brought  the UA's  attention the                                                               
need to address  a statutory resolution to give  some relief from                                                               
liability to the providers.                                                                                                     
                                                                                                                                
MR. KELLY  said SB 369  states that  for purposes of  a practicum                                                               
program,  the students  are not  to be  considered employees.  If                                                               
they  were  considered  as  employees,   the  employer  would  be                                                               
strictly liable,  which is where  the problem lies. SB  369 makes                                                               
participants  responsible  for  their  own liability.  If  UA  is                                                               
negligent, it  would be responsible,  likewise with  the employer                                                               
or student. He explained, "Also,  in anticipation that the courts                                                               
might determine  that the experiential  benefit of being  able to                                                               
...derive  experience and  education from  these companies  might                                                               
trigger the Fair Labor Standards  Act, we also have a recommended                                                               
section in there  dealing with minimum wage so that  it could not                                                               
be claimed that the students who  are currently not paid - and as                                                               
a matter  of fact that  is the nature  of a practicum  program is                                                               
that they  are not paid, they  are different from interns  - that                                                               
they couldn't  trigger the Fair  Labor Standards Act  and require                                                               
these providers  to give them  minimum wage." He deferred  to Mr.                                                               
Parrish  to  answer  questions.  He  affirmed  that  Mr.  Parrish                                                               
produced the 6-page analysis in members' packets.                                                                               
                                                                                                                                
CHAIR SEEKINS asked  Mr. Parrish to summarize  the liability that                                                               
UA would have if SB 369 does not pass.                                                                                          
                                                                                                                                
MR.  JAMO PARRISH,  general legal  counsel  for UA,  said SB  369                                                               
addresses the liability of the  practicum site, not the liability                                                               
of  UA. However,  UA currently  is liable  for any  negligence it                                                               
commits  and SB  369 would  not change  that. The  practicum site                                                               
would be  liable for any negligence  it commits; SB 369  does not                                                               
seek to  change that. However,  as Mr. Kelly said,  the practicum                                                               
site, if it is determined to  be an employer, would be liable for                                                               
any negligence  committed by  the student,  which is  the concern                                                               
that SB 369 would address.                                                                                                      
                                                                                                                                
CHAIR SEEKINS  asked if SB  369 will prevent a  practicum student                                                               
from initiating  a wage and hour  action at a later  date against                                                               
the company  that agreed  to provide  the student  with practical                                                               
experience.                                                                                                                     
                                                                                                                                
MR. PARRISH said that is correct.                                                                                               
                                                                                                                                
CHAIR SEEKINS announced that with  no further questions, he would                                                               
set the bill aside and move on to HB 188.                                                                                       
Upon  reconvening,   SENATOR  OGAN   moved  CSSB   369(L&C)  from                                                               
committee  with individual  recommendations  and attached  fiscal                                                               
note(s). There being no objection, the motion carried.