Legislature(1993 - 1994)

04/07/1994 03:00 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
  CHAIRMAN HUDSON brought up CSSB 64(JUD)(efd fld) - IMMUNITY                  
  FOR SAFETY INSPECTIONS and invited the prime sponsor to                      
  present the bill.                                                            
  Number 480                                                                   
  JOSH FINK, Staff, Senator Kelly, read the following sponsor                  
  "In 1988, the legislature passed a comprehensive revision of                 
  Alaska's workers' compensation laws.  At that time it was                    
  considered model legislation and was built around a no fault                 
  system.  Since taking effect, the new workers' compensation                  
  provisions have proven successful.                                           
  "The safety inspection issue was brought to the forefront as                 
  a result of the 1989 Van Biene v. ERA Helicopters, Inc.                      
  decision our Supreme Court, which held that "workers'                        
  compensation carrier could be held liable to estates of                      
  deceased pilots for negligent performance of safety                          
  inspection if insurer actually inspected the working                         
  conditions of the employer prior to the incident.  This                      
  ruling effectively ended the no fault system.                                
  "The unintended result is that carriers are unwilling to                     
  perform safety inspections and Alaskan workers are at                        
  greater risk of injury.  SB 64 removes insurers, insurance                   
  service agents, self-insured employers, and trade                            
  associations from civil liability for damages resulting from                 
  the performance or failure to perform a workplace safety                     
  inspection or a safety advisory service unless the act is                    
  intentional or negligent.                                                    
  "SB 64 ensures workplace safety inspections will continue,                   
  that workers' compensation insurance will be available and                   
  affordable because of safety inspection, and that employees                  
  benefit from safety inspections."                                            
  Number 525                                                                   
  DAVE HUTCHENS, Executive Director, Alaska Rural Cooperative                  
  Electric Association, testified in favor of SB 64. He                        
  explained to the committee that his organization created an                  
  insurance program which, in 1983, evolved into a reciprocal                  
  insurer which is a regulated insurance company chartered                     
  through the laws of the state.  Mr.Hutchens said the Van                     
  Biene issue impacted his organization greatly in that prior                  
  to the decision, they operated an intensive safety program                   
  for their members, but cannot afford the liability now.                      
  MR. HUTCHENS noted that SB 64 would correct this problem as                  
  well as Section 2 in HB 241.                                                 
  Number 567                                                                   
  REPRESENTATIVE GREEN asked if the Van Biene decision applied                 
  only to the inspector or did it also apply to his employer                   
  as well.                                                                     
  Number 574                                                                   
  MR. HUTCHENS replied that the decision affected the                          
  insurance company that had underwritten the employer.                        
  Number 580                                                                   
  REPRESENTATIVE MULDER asked if safety inspectors needed a                    
  minimum amount of accreditation.                                             
  MR. HUTCHENS replied that he didn't think there were any                     
  requirements for safety inspectors.                                          
  Number 588                                                                   
  REPRESENTATIVE MULDER stated that it seemed logical that if                  
  the state were to require safety inspections, then there                     
  should be some sort of minimum requirements.                                 
  MR. HUTCHENS agreed.                                                         
  Number 600                                                                   
  REPRESENTATIVE MACKIE stated that he thought the last time                   
  the committee heard the two bills, the direction given was                   
  for the various interest groups to come to a compromise.  He                 
  asked for an update on those talks.                                          
  Number 605                                                                   
  REPRESENTATIVE MULDER stated that an ad hoc task force                       
  comprised of three groups, organized labor, insurance                        
  providers, and the employer groups, worked through the                       
  interim but did not come to a compromise.                                    
  Number 635                                                                   
  REPRESENTATIVE MACKIE stated that there was obviously a                      
  problem or there wouldn't be these two bills.  He questioned                 
  what would happen if the legislature did nothing.                            
  Number 640                                                                   
  REPRESENTATIVE MULDER replied that from a policy standpoint,                 
  he thinks it is important to have workplace safety programs                  
  but also fells the health benefit extension is good public                   
  REPRESENTATIVE MULDER added that if the legislature did                      
  nothing some groups would still have workplace safety                        
  inspections and would assume the risk as they do now and                     
  others won't.                                                                
  TAPE 94-35, SIDE B                                                           
  Number 001                                                                   
  KEVIN SMITH, representing the Alaska Municipal League and                    
  the Joint Insurance Association, testified in favor of SB
  64.  He said he believes a safe workplace is good for the                    
  workers regardless of the politics involved.                                 
  Number 040                                                                   
  REPRESENTATIVE PORTER asked if Mr. Smith was a certified                     
  safety professional and, if not, how long would it take to                   
  become one.                                                                  
  Number 050                                                                   
  MR. SMITH said that he was not a certified safety                            
  professional, but noted within a year he could be.                           
  Number 060                                                                   
  PHIL FINKSTAD, Business Manager, Carpenters Union, testified                 
  that in 1988, a workers' compensation bill was passed and it                 
  was basically a management bill.  He stated that labor                       
  supported it because it was a very lean time and they felt                   
  that by helping to lower the costs to the employers, there                   
  may be more work.  He said over the last few years labor has                 
  tried to regain some of the lost ground.                                     
  MR. FINKSTAD stated that almost every job site he has been                   
  on over the last twenty years has had a safety program.                      
  MR. FINKSTAD stated that the Van Biene, by itself, is only                   
  beneficial to the insurers and the other two groups want to                  
  see the bill passed.                                                         
  Number 125                                                                   
  CHAIRMAN HUDSON stated that he recognized that any solution                  
  would require the accommodation of all sides of the issue.                   
  He added that he hoped that by bringing the bills up side by                 
  side a solution could be found, but that did not appear to                   
  be happening.                                                                
  Number 141                                                                   
  REPRESENTATIVE PORTER referred to gross negligence occurring                 
  and asked if the no fault system under workers' compensation                 
  would apply.                                                                 
  Number 144                                                                   
  MR FINKSTAD replied yes.                                                     
  Number 154                                                                   
  REPRESENTATIVE MULDER stated that he would go back to the                    
  parties involved one last time and try to come to a                          
  CHAIRMAN HUDSON asked Mr. Finkstad to tell Senator Kelly                     
  that this committee is committed to move the bill quickly                    
  when a solution is offered that accommodates everyone.                       
  CHAIRMAN HUDSON told the committee that he would hold both                   
  SB 64 and HB 241 over.                                                       
  Number 181                                                                   
  REPRESENTATIVE MULDER explained that HB 241 is a mirror of                   
  SB 64 except that it includes a section for health benefits                  
  for workers and their families who have been injured for an                  
  additional 12 months.  He explained that this legislation                    
  was passed by the legislature and made it to the governor in                 
  1989, but was vetoed over some technical glitches.                           
  CHAIRMAN HUDSON asked who pays for the additional insurance.                 
  REPRESENTATIVE MULDER replied that it would be the                           
  responsibility of the employer.  He added that the average                   
  number of months an employee is off the job is less than two                 
  Number 210                                                                   
  CHAIRMAN HUDSON restated that he was going to hold the bills                 
  over and adjourned the meeting at 5:00 p.m.                                  

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