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AB-2397 Workers’ compensation insurance, unemployment, and disability compensation.(2019-2020)

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Date Published: 05/01/2020 09:00 PM
AB2397:v98#DOCUMENT

Amended  IN  Assembly  May 04, 2020

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 2397


Introduced by Committee on Insurance (Assembly Members Daly (Chair), Mayes (Vice Chair), Berman, Bigelow, Calderon, Chen, Cooley, Cooper, Frazier, Gipson, Kamlager, Voepel, and Wood)

February 18, 2020


An act to amend Section 3700 of the Labor Code, and to amend Sections 402, 2058, 2070, 2604, 2614, 2655.1, and 4902 of the Unemployment Insurance Code, relating to the Employment Development Department. employment.


LEGISLATIVE COUNSEL'S DIGEST


AB 2397, as amended, Committee on Insurance. Employment Development Department: unemployment Workers’ compensation insurance, unemployment, and disability compensation.
Existing law establishes within the Employment Development Department an Appeals Division consisting of the California Unemployment Insurance Appeals Board and its employees. Each member of the appeals board serves for a term of 4 years and until the member’s successor is appointed and qualifies.
This bill would delete obsolete language relating to 1965 amendment of that term provision.
Existing law requires the department to maintain current information on operations within the state of all types of youth employment programs, including specified programs.
This bill would delete the references to specified programs.
Existing law states the public policy of the state regarding barring or terminating employment on the ground of age.
This bill would make nonsubstantive changes to that provision.
Existing law authorizes the Director of Employment Development, if the director believes that a change in contributions rate or disability benefit amounts may become necessary to protect the solvency of the Disability Fund, to inform the Governor and the Legislature and make recommendations.
This bill would require the director, instead of informing the Legislature, to inform the Assembly Committee on Insurance and the Senate Committee on Labor, Public Employment, and Retirement Committee.
The bill would update obsolete references in existing law to a predecessor committee to instead refer to the Senate Committee on Labor, Public Employment, and Retirement.
Existing law requires every employer, except the state, to secure the payment of workers’ compensation as provided by law. Existing law authorizes an employer to insure against liability through insurers duly authorized to write compensation insurance in the state. Under existing law, an employer includes the owner or occupant of a residential dwelling who hires a person whose duties are incidental to the ownership, maintenance, or use of the dwelling, including the care and supervision of children, or whose duties are personal and not in the course of the trade, business, profession, or occupation of the owner or occupant. Existing law requires a policy providing comprehensive personal liability insurance issued or renewed after January 1, 1977, to contain a provision for coverage against liability for workers’ compensation for the employee of an owner or occupant of a residential dwelling, unless another valid, collectible workers’ compensation insurance policy exists for that liability.
This bill would authorize an owner or occupant of a residential dwelling to include their workers’ compensation coverage in a policy of homeowners’ insurance issued by a nonadmitted insurer.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

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


SECTION 1.

 Section 3700 of the Labor Code is amended to read:

3700.
 (a) Every employer except the state shall secure the payment of compensation in one or more of the following ways:

(a)

(1) By being insured against liability to pay compensation by one or more insurers duly authorized to write compensation insurance in this state.

(b)

(2) By securing from the Director of Industrial Relations a certificate of consent to self-insure either as an individual employer, or as one employer in a group of employers, which may be given upon furnishing proof satisfactory to the Director of Industrial Relations of ability to self-insure and to pay any compensation that may become due to his or her the employer’s employees.

(c)

(3) For any county, city, city and county, municipal corporation, public district, public agency, or any political subdivision of the state, including each member of a pooling arrangement under a joint exercise of powers agreement (but not the state itself), by securing from the Director of Industrial Relations a certificate of consent to self-insure against workers’ compensation claims, which certificate may be given upon furnishing proof satisfactory to the director of ability to administer workers’ compensation claims properly, and to pay workers’ compensation claims that may become due to its employees. On or before March 31, 1979, a political subdivision of the state which, that, on December 31, 1978, was uninsured for its liability to pay compensation, shall file a properly completed and executed application for a certificate of consent to self-insure against workers’ compensation claims. The certificate shall be issued and be subject to the provisions of Section 3702.
(b) Notwithstanding paragraph (1) of subdivision (a), if a nonadmitted insurer issues a policy of homeowners’ insurance, workers’ compensation coverage may be included in the policy to the extent required by Section 11590 of the Insurance Code.

For

(c) For purposes of this section, “state” shall include includes the superior courts of California.

SECTION 1.SEC. 2.

 Section 402 of the Unemployment Insurance Code is amended to read:

402.
 (a) Each member of the appeals board shall serve for a term of four years and until the member’s successor is appointed and qualifies.
(b) A vacancy shall be filled by the appointing power by appointment for the unexpired term. A vacancy filled by the Governor shall be subject to the approval of the Senate.

SEC. 2.SEC. 3.

 Section 2058 of the Unemployment Insurance Code is amended to read:

2058.
 (a) The department shall cooperate with other departments, agencies, and institutions both public and private in providing youth placement services and in the development of youth employment programs.
(b) The department shall maintain current information on operations within the state of all types of youth employment programs. Upon request, the department shall distribute to public and private agencies and groups information concerning any or all recognized plans for developing youth employment programs, the cooperative services offered by the various state and other public agencies in the field of youth employment, and the methods of initiating and developing those programs.

SEC. 3.SEC. 4.

 Section 2070 of the Unemployment Insurance Code is amended to read:

2070.
 It is the public policy of the State of California that the workforce should be used to its fullest extent. This statement of policy compels the further conclusion that human beings seeking employment, or retention of employment, should be judged fairly and without resort to rigid and unsound rules that operate to disqualify significant portions of the population from gainful and useful employment. Accordingly, use by employers, employment agencies, and labor organizations of arbitrary and unreasonable rules that bar or terminate employment on the ground of age offend the public policy of this state.

SEC. 4.SEC. 5.

 Section 2604 of the Unemployment Insurance Code is amended to read:

2604.
 Whenever the Director of Employment Development believes that a change in contributions rate or disability benefit amounts may become necessary to protect the solvency of the Disability Fund, the director shall at once inform the Governor, the Assembly Committee on Insurance, and the Senate Committee on Labor, Public Employment, and Retirement thereof and make recommendations accordingly. In that case, the Governor may declare an emergency and authorize the Director of Employment Development to announce a modified scale of benefits or increased waiting period, or other changes in regulations regarding the eligibility for payment of benefits that the Director of Employment Development deems necessary to ensure the solvency of the Disability Fund; those modified regulations are to be in effect until the Governor declares the emergency at an end or until further action is taken by the Legislature.

SEC. 5.SEC. 6.

 Section 2614 of the Unemployment Insurance Code is amended to read:

2614.
 The director shall report to the Assembly Committee on Insurance, Assembly Committee on Labor and Employment, and the Senate Committee on Labor, Public Employment, and Retirement by June 30 of each year on the department’s fraud deterrence and detection activities.

SEC. 6.SEC. 7.

 Section 2655.1 of the Unemployment Insurance Code is amended to read:

2655.1.
 (a) By March 1, 2021, the department shall prepare and submit to the Legislature, including the legislative committees described in subdivision (c), a report that includes data on levels and trends between January 1, 2017, and the latest date for which data is available in 2020, in the following:
(1) Utilization of paid family leave and disability insurance by income level, including, but not limited to, utilization of paid family leave by low-wage workers.
(2) Benefit costs.
(3) Supplemental disability insurance contribution rates.
(b) The report described in subdivision (a) shall also include projections of utilization and costs for three subsequent years beginning January 1, 2022, with the assumption that the wage replacement rates that are in effect on January 1, 2018, remain in effect.
(c) A report submitted pursuant to this section shall be submitted in compliance with Section 9795 of the Government Code and shall be submitted to the Assembly Committee on Insurance, the Senate Committee on Labor, Public Employment, and Retirement, the Assembly and Senate Committees on Appropriations, the Assembly Committee on Budget, and the Senate Committee on Budget and Fiscal Review.
(d) Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2024.

SEC. 7.SEC. 8.

 Section 4902 of the Unemployment Insurance Code is amended to read:

4902.
 The report, required by Section 4901, shall be transmitted to the Legislative Analyst, the Assembly Committees on Insurance, Labor and Employment, and Budget, the Senate Committees on Labor, Public Employment, and Retirement and Budget and Fiscal Review, the Department of Finance, and the Governor, on or before February 1 of each even-numbered year. The report shall do all of the following:
(a) Provide a strategic information technology plan that describes the long-term goals and strategies which shall be undertaken by the department to create an information technology environment that will not only support the achievement of the department’s strategic business mission and goals but set the foundation for using information technology to make substantial and sustainable improvements in how it conducts business. The plan shall cover a 10-year planning horizon and include the department’s information vision, its information management principles, and long-term goals and strategies for achieving its information vision.
(b) Provide a tactical information plan of specific automation and infrastructure projects to be undertaken within three years of the date of the report. The plan shall include project description and scope, consistency with the strategic information plan, relationship to other projects, priority of development, estimated project costs and benefits, and improvements in services. For automation projects, it shall also provide reductions in personnel and operating costs, and identification of how personnel and cost savings will be used, transferred, or otherwise accounted for.
(c) Not necessarily be in addition to or replace any reports now submitted by the director to the Department of Technology.