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AB-842 Contractors: trust or custodial benefits plans: essential health benefits.(2015-2016)

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CALIFORNIA LEGISLATURE— 2015–2016 REGULAR SESSION

Assembly Bill No. 842


Introduced by Assembly Member Patterson

February 26, 2015


An act to add Chapter 2.5 (commencing with Section 325) to Part 1 of Division 2 of the Labor Code, relating to contractors.


LEGISLATIVE COUNSEL'S DIGEST


AB 842, as introduced, Patterson. Contractors: trust or custodial benefits plans: essential health benefits.
Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacts various health care coverage market reforms that take effect January 1, 2014. Among other things, the PPACA requires a health insurance issuer that offers coverage in the small group or individual market to ensure that the coverage includes the essential health benefits package, as defined, and describes essential health benefits for that purpose.
Existing law states that it is the policy of this state to vigorously enforce the laws requiring employers to secure the payment of compensation for workers, as specified. Existing law defines a project labor agreement, as specified. A project labor agreement may include a trust or custodial benefit plan to provide health and welfare or similar benefits for workers.
This bill would provide that a contractor that bids on or has been awarded work covered by a project labor agreement that provides health care coverage to workers on the project that is the subject of the agreement, that includes essential health benefits, as described in the PPACA, and that provides evidence of that coverage to the entity awarding the contract, is exempt from a requirement to pay into a trust or custodial benefit plan for health and welfare or similar benefits for those workers an amount equal to the amount that the contractor would have been required to pay into that trust or custodial benefit plan for health care costs for those workers.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Chapter 2.5 (commencing with Section 325) is added to Part 1 of Division 2 of the Labor Code, to read:
CHAPTER  2.5. Contractors: employee health benefits.

325.
 For purposes of this chapter, the following definitions apply:
(a) A “project labor agreement” refers to a prehire collective bargaining agreement that establishes the terms and conditions of employment for a specific construction project and is an agreement described in Section 158(f) of Title 29 of the United States Code.
(b) The “PPACA” refers to the federal Patient Protection and Affordable Care Act (Public Law 111-148), as amended by the federal Health Care and Education Reconciliation Act of 2010 (Public law 111-152), and any rules, regulations, or guidance issued thereunder.

326.
 A contractor that bids on or has been awarded work covered by a project labor agreement that provides health care coverage to workers on the project that is the subject of the agreement, that includes essential health benefits, as described in the PPACA in Section 18022 of Title 42 of the United States Code, and that provides evidence of that coverage to the entity awarding the contract, is exempt from a requirement to pay into a trust or custodial benefit plan, designated by the project labor agreement to provide health and welfare or similar benefits for those workers, an amount equal to the amount that the contractor would have been required to pay into that trust or custodial benefit plan for health care costs for those workers.