Legislature(2009 - 2010)BELTZ 105 (TSBldg)
03/30/2010 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB377 | |
| Confirmation Hearings | |
| SB298 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | SB 298 | TELECONFERENCED | |
| + | HB 377 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 377-VOLUNTEER AMATEUR SPORTS OFFICIALS
1:55:03 PM
CHAIR PASKVAN announced HB 377 to be up for consideration.
1:55:08 PM
REPRESENTATIVE BILL STOLTZE, sponsor of HB 377, introduced
himself. He said this issue was brought to him by folks active
in both Southcentral and Interior youth sports activities facing
the prospect of finding themselves in a unique situation of
becoming something they didn't realize - direct employers. The
problem arises out of enforcement by the Alaska Department of
Labor and Workforce Development (DOLWD) to protect workers from
manipulation and by strictures of the federal government on
employee exemptions for volunteer work as sports officials.
1:56:27 PM
SENATOR BUNDE joined the committee.
REPRESENTATIVE STOLTZE said his intent is to bring forth a
vehicle that provides for as much latitude for these volunteer
organizations, which are basically scraping by to just keep kids
on the ice or on the soccer fields and providing the basic
scoring and officiating that is needed, without the having the
responsibilities of unemployment tax. The federal government
provides a $1500 exemption for volunteer activities that have
some compensation. It is not a wage, but rather a stipend or a
per diem type of compensation. He preferred a broader approach,
but his hands are tied by the federal law. He said that many
Alaskans are involved in youth sports; so this is an important
issue.
He said the Alaska School Activities Association (ASAA) is the
main entity that brought this forward and it has avalanched into
other folks presenting their interests.
1:59:46 PM
MORGAN HOBSON, staff to Representative Stoltze, said the intent
of the bill is not to help folks who referee as a full time job,
but to help people who volunteer their time at local sporting
events and receive money to cover incidentals such as food and
travel. These volunteers cover many of their own expenses
including training, certification, costs associated with their
officials organizations, uniforms, and this job is performed
purely as an avocation for the sake of community sports. This
measure would only apply to volunteers who receive less than
$1500 cumulatively per year over all sports they are involved
with as well as supporting organizations. This amount cannot be
raised, although many people have testified that it would be
beneficial to have a higher amount. But the state would lose
funding for unemployment insurance if that amount was raised.
Sports officials, whether they are volunteers or amateurs cannot
be entirely exempted from unemployment insurance, but this gives
leeway to help folks who do this for several games in the summer
or who help out with a son or daughter's sport event.
2:01:40 PM
SENATOR BUNDE said he received several communications from
people supporting this issue, but nothing from people opposing
it and he wanted to know if there is any opposition.
MS. HOBSON replied that the only concerns they have heard are
from folks who want a higher limit, but after looking into that
they found it is not a possibility.
REPRESENTATIVE STOLTZE added that the opposition has been in
legal form from the federal government.
SENATOR BUNDE asked if these various groups have liability
insurance that would cover injuries.
MS. HOBSON answered that workers' compensation would be totally
outside of this.
REPRESENTATIVE STOLTZE added that ASAA carries workers'
compensation insurance, but he would leave that to them to
testify about.
2:03:40 PM
CHAIR PASKVAN asked if it is possible for one of these officials
to receive unemployment insurance, and if so, under what
conditions.
SENATOR JOE THOMAS asked relative to the $1500 cap for
compensation, would it be a good idea to consider the soccer
association or whatever as the employer so they can fill out
some kind of contract acknowledging that they are a volunteer,
and setting out standards to eliminate confusion at a later
date.
REPRESENTATIVE STOLTZE replied that these people are not
employees of the school districts or associations. They are
usually dispatched through an official's association. They do it
for love of the sport and to stay involved.
2:06:23 PM
SENATOR KEVIN MEYER joined the committee.
2:06:31 PM
SENATOR BUNDE said he is all in favor of the bill, but sometimes
the push back from people who do activities like this for a
living is that their opportunity to make a living is being
undercut. His comment earlier was if they were full-time
employees there would be some workers' compensation involved if
there was an injury. What kind of liability coverage do these
part time workers have?
PAULA SCAVERA, legislative liaison, Alaska Department of Labor
and Workforce Development (DOLWD), said that she asked this
question of the workers' compensation division and she was told
that volunteers are volunteers and they are exempt from workers'
compensation laws.
SENATOR BUNDE said that is a little part of his problem. It's a
contradiction in terms. How can someone get paid for
volunteering?
MS. SCAVERA replied that these are not considered wages - they
get their uniform cleaned or they get reimbursed for a new rule
book. Language on page 7 of HB 377 says that volunteer work
means "work for which compensation does not exceed and is paid
only to defray or reimburse the reasonable food, travel, and
incidental expenses the person occurs in order to perform the
work." The word "wages" isn't there.
SENATOR BUNDE said he is more familiar with it being labeled as
an honorarium.
MS. SCAVARA stated that she wasn't a drafting attorney and that
is the way it was drafted.
2:09:17 PM
CHAIR PASKVAN asked if they are exempted, could they still be
covered under Unemployment Insurance.
BILL CRAEMER, Chief, Unemployment Insurance, Department of Labor
and Workforce Development (DOLWD), answered if someone has
covered wages in the system and then they file an unemployment
claim they could draw unemployment benefits based on those
wages. Reimbursement for expenses - uniforms and travel, for
instance - are not considered wages. They are not taxed and they
wouldn't help someone qualify for a claim.
2:10:46 PM
RICHARD WISENEN, certified USA Hockey official, Kenai, Alaska,
said he is also a certified National Federation high school
hockey official, a volunteer local supervisor and a trainer for
USA Hockey that trains hockey officials. He also sits on the
board of directors for their local hockey referee association.
He said they need to avoid any unintended consequences of
passing any bill, and if this bill passes it won't alleviate the
current problem that is forcing sport programs to cut back due
to the increased cost of obtaining officials for the games. In
the case of the Hockey Referee Association, they supply official
for everything from youth hockey to varsity junior varsity at
the high school level and adult leagues. If they have to charge
each group the extra fees to cover unemployment and workers'
compensation for these games it will be even more expensive for
the programs.
He said the $1500 cap only adds confusion. Any time a referee is
assigned a game he has to charge the league for those fees and
might have no idea which person that is going to bid for the job
will be able to pass that threshold in their year. Their
officials' contracts, which were drawn up with the help of an
attorney, include the statement that they are working for the
association as independent contractors and as such no workers'
compensation or unemployment needs to be withheld. His
association pays $35,000 - $40,000 a year to approximately 50
different officials. With these regulations, they are thinking
about hiring an accountant that would add an extra $10,000 to
the fees they have to charge the association. Currently a
volunteer treasurer handles this as an independent contractor.
He said a number of young people officiate at boys and girls
soccer as well as the hockey program, and many are beyond the
$1500 threshold. Most states he has worked in treat officials as
independent contractors and thus avoid this dilemma completely.
They would be better served providing an exemption under AS
23.10.055 where 17 other exemptions for the Employment Security
Act reside rather than forward HB 377. He suggested using
language saying that "anyone officiating amateur sports where
they are compensated on a per game basis" and that would
eliminate the problem they are facing. Sports programs are
already very costly, but they are important to the welfare and
health of our communities. They are trying to help the kids out.
2:15:01 PM
REPRESENTATIVE STOLTZE commented that he prefers an exemption as
well, but this is what the Department of Labor says the feds
will allow. It's not as simple as what the gentleman from Kenai
stated. The path in SB 377 will meet the legal test.
SENATOR BUNDE said previous testimony indicated that volunteers
were part of an organization. His conception is that a lot of
these teams are not hiring out of a main hall; they're getting
their volunteer workers from an informal group locally.
REPRESENTATIVE STOLTZE responded that some of the more organized
sports generally have an a bigger more sophisticated official's
association like USA Hockey that that has expenses. It makes the
operation of a local summer soccer league pale in comparison.
This issue is difficult, he said, and HB 377 won't help
everybody, but it will provide relief for many. He would have
preferred an exemption, but he didn't want to open other doors
and provide abuse of contract employees. He said it's
frustrating because their hands are tied at a level far beyond
the borders of our state.
2:19:32 PM
MS. SCAVERA added that she helped Representative Stoltze's
office send four different bill versions to the US Department of
Labor (USDOL) to see what would pass. Then they looked at what
other states tried to do and found this. USS Code 26.33.09 says
non profits and government entities cannot exempt employees
totally from the Unemployment Insurance Act. One of the drafts
tried the exclusion and USDOL said no.
2:21:30 PM
SENATOR THOMAS said he was a little confused about what they are
actually considering. They talked about volunteers in the bill,
yet some of the attached information doesn't talk about
volunteers at all, but rather people in two different
classifications that are independent contractors or employees.
Is that what is confusing the situation? Is workers'
compensation the issue they are looking at?
MS. SCAVERA said she hadn't read the article he was referring
to, but she knew there was a difference between independent
contractors and volunteers. This bill is just about volunteers;
it has nothing to do with the relationship of contractors and
independent contractors. Since December she had been talking to
people from other states that are trying to do the same thing,
and some of them have gone to an independent contractor
situation and later had those struck down by the USDOL.
SENATOR THOMAS asked if there is a way to solve the situation
that was brought to them by Mr. Wisenen short of where they are.
His concern seemed to be paying the individuals and somehow
keeping track of the pay and when a person hits the $1500 cap.
Is that your understanding of the problem?
2:24:34 PM
MR. CRAEMER answered that the federal law is very clear that
wages of sports officials working for non-profit organizations
may not be exempted from being covered under the Unemployment
Insurance Program. The federal statute tries to be very
inclusive to provide coverage for workers; so they want the
wages included. They specifically say they may not be exempted
because of being for a nonprofit organization. The question
about employees versus independent contractors gets complicated
fairly quickly. Alaska statute is very clear on it. To meet the
level of independent contractor is a pretty difficult test.
He said he understands that HB 377 clarifies that reimbursement
for incurred expenses should not be reported as covered wages.
SENATOR THOMAS said he didn't see this reimbursement up to $1500
as wages, and he thought this bill was the best solution they
could find.
MS. SCAVERA said this bill was for those people who have
actually tried to referee a soccer game once, to reimburse them
for gas or meals, a uniform or studying the rules. They aren't
wages whatsoever. It's to help reimburse the "mom and pop"
organizations. She said she has a friend who goes through a
couple of uniforms a year officiating kids' basketball games -
kids bleed on his shirt and things like that. So he can put in
to be reimbursed for his uniform.
CHAIR PASKVAN stated he thought Representative Stoltze indicated
it very well when he said this is not a solution for everyone.
Federal law does not allow a broader solution. This is the best
that can be done.
2:29:33 PM
SENATOR BETTYE DAVIS said she thought the Department of Law was
on line and wanted to know if they had something to add. No one
from the department was on line, so they moved on.
2:30:02 PM
SENATOR THOMAS moved to report HB 377 from committee with
individual recommendations and attached zero fiscal note(s).
There were no objections and it was so ordered.
2:30:31 PM
CHAIR PASKVAN announced an at ease from 2:30 to 2:32 p.m.
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