Bill Text: CA AB2305 | 2009-2010 | Regular Session | Amended

California Assembly Bill 2305 (Prior Session Legislation)

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: Contractors: workers' compensation insurance coverage.

Spectrum: Partisan Bill (Republican 2-0)

Status: (Passed) 2010-09-28 - Chaptered by Secretary of State - Chapter 423, Statutes of 2010. [AB2305 Detail]

Download: California-2009-AB2305-Amended.html

BILL NUMBER: AB 2305	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JULY 1, 2010
	AMENDED IN ASSEMBLY  APRIL 22, 2010
	AMENDED IN ASSEMBLY  APRIL 14, 2010

INTRODUCED BY   Assembly Member Knight
   (Principal coauthor: Senator Runner)

                        FEBRUARY 19, 2010

   An act to amend Section 7125 of the Business and Professions Code,
and to amend Section 11665 of the Insurance Code, relating to
contractors.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2305, as amended, Knight. Contractors: workers' compensation
insurance coverage.
   (1) Existing law requires private employers to secure the payment
of compensation by obtaining and maintaining workers' compensation
insurance or to self-insure as an individual employer or as one
employer in a group of employers. The Contractors' State License Law
requires every licensed contractor to have on file at all times with
the Contractors' State License Board a current and valid Certificate
of Workers' Compensation Insurance or Certification of
Self-Insurance, or a statement certifying that he or she has no
employees and is not required to obtain or maintain workers'
compensation insurance coverage. Existing law, until January 1, 2011,
requires a contractor with a C-39 roofing classification to obtain
and maintain workers' compensation insurance even if he or she has no
employees. Failure to comply with this requirement results in the
automatic suspension of the license. However, with respect to a
license that was active on January 1, 2007, and included a C-39
roofing classification, existing law, until January 1, 2011, requires
the registrar of contractors, in lieu of suspending the license, to
remove the C-39 roofing classification from the license if the
contractor does not have workers' compensation insurance coverage.
   This bill would extend the operation of those provisions until
January 1,  2014   2013  , with respect to
a license that is active on January 1, 2011, with a C-39 roofing
classification.  The bill would require the suspension of any
license that, after January 1, 2011, is active and has had the C-39
roofing classification removed, of the licensee is found by the
registrar of contractors to have employees   and to lack a
valid Certificate of Workers' Compensation Insurance or Certification
of Self-Insurance. 
   (2) Existing law requires an insurer who issues a workers'
compensation insurance policy to a roofing contractor holding a C-39
license from the Contractors' State License Board to perform an
annual payroll audit for the contractor. Existing law requires the
Insurance Commissioner to direct the rating organization designated
as his or her statistical agent to compile pertinent statistical data
on those holding C-39 licenses on an annual basis and to provide a
report to the commissioner each year. Existing law provides that
these provisions are inoperative and repealed on January 1, 2011.
   This bill would extend the operation of these provisions until
January 1,  2014   2013  .  The bill
would require the report provided to the commissioner each year to
also be provided to the Legislature, as specified. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 7125 of the Business and Professions Code, as
amended by Section 1 of Chapter 38 of the Statutes of 2006, is
amended to read:
   7125.  (a) Except as provided in subdivision (b), the board shall
require as a condition precedent to the issuance, reinstatement,
reactivation, renewal, or continued maintenance of a license, that
the applicant or licensee have on file at all times a current and
valid Certificate of Workers' Compensation Insurance or Certification
of Self-Insurance. A Certificate of Workers' Compensation Insurance
shall be issued and filed, electronically or otherwise, by one or
more insurers duly licensed to write workers' compensation insurance
in this state. A Certification of Self-Insurance shall be issued and
filed by the Director of Industrial Relations. If reciprocity
conditions exist, as defined in Section 3600.5 of the Labor Code, the
registrar shall require the information deemed necessary to 
assure   ensure  compliance with this section.
   (b) This section does not apply to an applicant or licensee who
meets both of the following conditions:
   (1) Has no employees provided that he or she files a statement
with the board on a form prescribed by the registrar prior to the
issuance, reinstatement, reactivation, or continued maintenance of a
license, certifying that he or she does not employ any person in any
manner so as to become subject to the workers' compensation laws of
California or is not otherwise required to provide for workers'
compensation insurance coverage under California law.
   (2) Does not hold a C-39 license, as defined in Section 832.39 of
Title 16 of the California Code of Regulations.
   (c) No Certificate of Workers' Compensation Insurance,
Certification of Self-Insurance, or exemption-certificate is required
of a holder of a license that has been inactivated on the official
records of the board during the period the license is inactive.
   (d) The insurer, including the State Compensation Insurance Fund,
shall report to the registrar the following information for any
policy required under this section: name, license number, policy
number, dates that coverage is scheduled to commence and lapse, and
cancellation date if applicable.
   (e)  (1)    For any license that, on January 1,
2011, is active and includes a C-39 classification in addition to any
other classification, the registrar shall, in lieu of the automatic
license suspension otherwise required under this article, remove the
C-39 classification from the license unless a valid Certificate of
Workers' Compensation Insurance or Certification of Self-Insurance is
received by the registrar. 
   (2) For any licensee whose license, after January 1, 2011, is
active and has had the C-39 classification removed as provided in
paragraph (1), and who is found by the registrar to have employees
and to lack a valid Certificate of Workers' Compensation Insurance or
Certification of Self-Insurance, that license shall be automatically
suspended as required under this article. 
   (f) This section shall remain in effect only until January 1,
 2014   2013  , and as of that date is
repealed, unless a later enacted statute, that is enacted before
January 1,  2014   2013  , deletes or
extends that date.
  SEC. 2.  Section 7125 of the Business and Professions Code, as
added by Section 2 of Chapter 38 of the Statutes of 2006, is amended
to read:
   7125.  (a) The board shall require as a condition precedent to the
issuance, reinstatement, reactivation, renewal, or continued
maintenance of a license, that the applicant or licensee have on file
at all times a current and valid Certificate of Workers'
Compensation Insurance or Certification of Self-Insurance. A
Certificate of Workers' Compensation Insurance shall be issued and
filed, electronically or otherwise, by one or more insurers duly
licensed to write workers' compensation insurance in this state. A
Certification of Self-Insurance shall be issued and filed by the
Director of Industrial Relations. If reciprocity conditions exist, as
defined in Section 3600.5 of the Labor Code, the registrar shall
require the information deemed necessary to  assure 
 ensure  compliance with this section.
   (b) This section does not apply to an applicant or licensee who
has no employees provided that he or she files a statement with the
board on a form prescribed by the registrar prior to the issuance,
reinstatement, reactivation, or continued maintenance of a license,
certifying that he or she does not employ any person in any manner so
as to become subject to the workers' compensation laws of California
or is not otherwise required to provide for workers' compensation
insurance coverage under California law.
   (c) No Certificate of Workers' Compensation Insurance,
Certification of Self-Insurance, or exemption-certificate is required
of a holder of a license that has been inactivated on the official
records of the board during the period the license is inactive.
   (d) The insurer, including the State Compensation Insurance Fund,
shall report to the registrar the following information for any
policy required under this section: name, license number, policy
number, dates that coverage is scheduled to commence and lapse, and
cancellation date, if applicable.
   (e) This section shall become operative on January 1, 
2014   2013  .
  SEC. 3.  Section 11665 of the Insurance Code is amended to read:
   11665.  (a) An insurer who issues a workers' compensation
insurance policy to a roofing contractor holding a C-39 license from
the Contractors State License Board shall perform an annual payroll
audit for the contractor. The insurer may impose a surcharge on each
policyholder audited under this subdivision in an amount necessary to
recoup the reasonable costs of conducting the annual payroll audits.

   (b) The commissioner shall direct the rating organization
designated as his or her statistical agent to compile pertinent
statistical data on those holding C-39 licenses, as reported by the
appropriate state entity, on an annual basis and provide a report to
him or her each year. The data shall track the total annual payroll
and loss data reported on those holding C-39 licenses in accordance
with the standard workers' compensation insurance classifications
applicable to roofing operations.  The report shall also be
provided to the Legislature, in compliance with Section 9795 of the
Government Code. Reports required under   this section for
the 2008 and 2009 calendar years shall be filed by January 1, 2012.

   (c) This section shall remain in effect only until January 1,
 2014   2013  , and as of that date is
repealed, unless a later enacted statute, that is enacted before
January 1,  2014   2013  , deletes or
extends that date.