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Workers’ Compensation Bill Becomes Law

By May 20, 2008 commercial
SB1748/HB1645 will require sole proprietors and partners in the construction  business to carry workers’ compensation on themselves unless they are working directly for the end user. In other words, all sole proprietors and partners doing construction work for a general contractor or another subcontractor will be required to carry workers’ compensation on themselves, or be covered by the general’s policy.
The Insurors have been leading the effort to make this change in the workers’ compensation law for the last two years. The change basically puts into law court decisions on coverage for sole proprietors and partners. This change should eliminate independent contractor questions on audit as the general or subcontractor will be charged for any sole proprietors and partners that have done work for them unless the sole proprietors and partners carry their own workers’ compensation policy.
The bill was supported by all four construction trade associations, ABC, AGC, Roadbuilders and Homeb

uilders, in addition to support from organized labor and assistance from the Tennessee Departments of Labor and Insurance. Insurance interests involved include: AIA, PICA, Liberty and Allstate.
Insuror member Senator Bill Ketron and House Minority Leader Jason Mumpower carried the bill through two years of hearings and meetings. Senate leaders Jim Kyle and Lt. Governor Ron Ramsey provided valuable assistance and advice. Passage was bi-partisan in almost equal amounts in both chambers. Prior to final passage last week the bill was discussed no less than 14 times in various committees.
The new law has an implementation date of December 31, 2009. This length of time was selected to give contractors sufficient time to adapt to the new law. Likewise both state departments will have time to make necessary changes for smooth implantation.
Source: Insurors of Tennessee Volume 08-10 Friday – May 16th, 2008